At this point, there are strong indications that the commuted pension of central government employees would be restored after 12 years rather than the current condition of 15 years under the 8th Pay Commission. This is a great welcome for employees and pensioners, as the potential change would relieve them financially at a much earlier stage of their retirement.
What Is Commuted Pension?
A commuted pension refers to a one-time payment at the time a central government employee retires which they can choose to accept. A portion of their monthly pension is deducted in exchange for this one-time payment amount for a set period (currently set at 15 years). After this period, the pensioner receives the full pension amount once again.
Proposed Changes Under The 8th Pay Commission
This is mainly to ensure the restoration of their full pension amount sooner for pensioners-by having the period for commuted pension restoration reduced from 15 years to 12 years. This is what it means for retirees of the central government.
- Softer Landing on the Overall Effect of Reduced Gaps in Time: The pensioners will overall have a quicker return to their full pension amount, which is welcome relief from financial burdens.
- Higher Income per Month: These benefits will be noticed very sharply once the commutation phase ends.
- Better Enhanced Benefits at Retirement: With a shorter restoration period, the retiring person can afford enhanced benefits as an individual retires.
Why This Change Is Noteworthy
For the same reason, this change is supported by the cost of living and inflation. The commuted period reduced from 15 years to 12 years might serve relief to those suffering, along with pensioners, who are dependent on their pensions for day to day expenses.
Government Stand On The Proposal
Discussions are apparently going on, with no official announcement provided so far, but the recommendations of the 8th Pay Commission shall be given for this issue. The unions of government employees have given their full support to this proposal and are raising their voices to see their demand met by the government.
Conclusion
If the commuted pension restoration period is reduced to 12 years, it will be the first step toward better welfare measures for central government retirees. Those employees who have opted for commutation will stand to gain from an increased monthly pension much earlier than they had originally expected. Pensioners sit with optimism for a favorable decision as the government deliberates on this proposal.
Keep an eye on this page for more news as the 8th Pay Commission wraps its recommendations.
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