RSCWS explains the advantages of choosing Importance of Option 1 of 7th Pay Commission for Revised Pension

Railway Senior Citizens Welfare Society elaborates advantages for Pre 2016 pensioners in choosing Importance of Option 1 of 7th Pay Commission for Revised Pension

IMPORTANCE OF OPTION 1 OF 7TH CPC FOR REVISED PENSION
– BIG LOSS IN PENSION IF IT IS DENIED

By N. P. MOHAN, President, RSCWS

Most of the Pre 2016 pensioners will suffer heavy loss in Revised Pension, if the Option 1 recommended by the Seventh CPC is denied to them.

It was after 20 years that 7th CPC recommended parity between past pensioners and those retiring after 1-1-2016 under Option 1    which means  consideration of increments earned while in service as detailed in Para 10.1.67 of  the Report. This objective of PARITY (Recommended by Commission after examining all factors in depth in Chapter 10) is fulfilled  only with  the  implementation  of  option  1  without  any  dilution/deviation.  Non implementation of option 1 on the plea of non availability of record in a few cases will have the following adverse effects:

i)    Pre 2006 pensioners, in particular, who are victim of modified parity will suffer a much bigger loss compared to the post 2006 retirees because in their case the basic pension which is multiplied by 2.57 in the interim phase takes into accounts their increments before retirement. This aspect has been examined in the case of Pre & Post S 19 pensioner as an example. From the Table 1 given below, it will be clear that  the  reduction  in  pension  for  post  2006  pensioner  is  of  a  uniform  small magnitude as compared to the loss increasing exponentially with each increment lost in case of pre 2006 pensioner. Similar is the case in other scales also

ii)  7tCPC  has  considered  pre  2016  pensioners  as  one  homogeneous  group  (Para10.1.53 refers). It means that all pre 2016 pensioners have to be treated alike. But with denial of option 1, pre 2016 pensioners will get divided into two groups i.e. Pre 2006 and Post 2006 Pensioners – which violates the settled law of equality between the equals.

iii) In  many  cases,  Option  3  gives  much  lower  pension compared  to  option  1 recommended  by  7tCPC.  This will  be  clear  from  Table  2  below.  Where  a comparison has been made between two options.

Enlcs: 2 Tables

TABLE- 1 SHOWING LARGE REDUCTION IN REVISED PENSION OF PRE-2006 PENSIONERS COMPARED WITH POST-2006 PENSIONERS IF OPTION 1 IS DENIED ILLUSTRATIVE EXAMPLE OF LEVEL 11 (Scale S 19 – PB3)

POST 2006  PENSIONER

PRE 2006
PENSIONER

 

Increments

Pay with increments
@ 3% pa

Corres- ponding Existing pension (col. 2/2)

Revsd pension with MF of
2.57

Pension for
L 11 as per matrix table

Reduction in pension with denial of Option 1 (col 5-4)

Revsd pension with MF of 2.57

Reductio
n in pension with denial of Option 1 (col 5-7)

1

2

3

4

5

6

7

8

0

25200

12600

3238233850

1468

323821468

1

25956

12978

3335334850

1497

323822468

2

26735

13367

3435435900

1546

323823518

3

27537

13768

3538537000

1615

323824618

4

28363

14181

3644638100

1654

323825718

5

29214

14607

3754039250

1710

323826868

6

30090

15045

3866640450

1784

323828068

7

30993

15496

3982641650

1824

323829268

8

31923

15961

4102142900

1879

3238210518

9

32880

16440

4225144200

1949

3238211818

10

33867

16933

4351945550

2031

3238213168

11

34883

17441

4482446900

2076

3238214518
1. From the above table it will be clear, that pre-2006 pensioners, as victims of Modified Parity will stand to lose more in pension compared to post -2006 pensioners if Option 1 of counting increments is not accepted by Govt.
2. The loss in pension for post 2006 pensioners is in the range of Rs.1700 (from 1468 to a max of 2076 as per col. 6) only and is nearly constant , whereas for pre-2006 pensioners  the loss in pension increases  by almost Rs.1000/- for every one increment (Refer cols. 6 & 8).
3. For example, the loss suffered in pension of pre 2006 pensioner in losing 5 increments works out to 6868 as against 1710 for post 2006 pensioner.

N. P. MOHAN 29-9-2016

TABLE 2 SHOWING REVISED PENSION OF SCALE S 29-PB 4 (LEVEL 14) PENSIONERS OF 4th CPC REGIME
WITH & 3rd  OPTION BASED ON NOTIONAL PAY OF SUCCESSIVE PAY COMMISSIONS
(Para 5 of minutes of meeting  held on 6th October, 2016) vs  OPTION 1 BASED ON INCREMENTS EARNED

Pay on retirement

Notional pay-5th CPC

Notional pay-6th CPC (Fitment table-6th CPC)

Notional pay-7th CPC with MF OF
2.57-3rd option
(col.3xMF)

Operative
Pay of col. 4 in the next cell of pay matrix (MOF OM dt   25-7-
2016)

Pay based on option
1 with increments
( as per pay matrix)

Pension as per option 3 (col.5/2)

Pension as per option 1 (col.6/2)

Loss of
Revised pension if Option 1 is not given (Difference between Option
1 &  3)
(col.8-7)

1

2

3

4

5

6

7

8

9

5900184005470014057914420014420072100

72100

0

6100184005470014057914420014850072100

74250

2150

6300184005470014057914420015300072100

76500

4400

6500189005605014404914420015760072100

78800

6700

6700189005605014404914420016230072100

81150

9050

6900189005605014404914420016720072100

83600

11500
7100194005605014404914420017220072100

86100

14000
7300194005605014404914420017740072100

88700

16600
NOTE: 1.3rd Option is not suitable at all. The loss in pension is clear from col. 9.
2. Notional pay in 6th CPC in col. 3 has been taken from the Fitment table issued by MOF (DOE) on 30-8-2008.
–  Compiled by: N. P. MOHAN 24-10-2016

Source : RSCWS

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