Retirement Benefits – Memorandum to 8th Central Pay Commission by Staff Side of NC- JCM

 Retirement Benefits – Memorandum to 8th Central Pay Commission by Staff Side of NC- JCM

(No. NC-JCM-2026/8th CPC dated 14-04-2026)

JCM
STAFF SIDE OF NATIONAL COUNCIL – JCM
for
Central Government Employees
MEMORANDUM 
Submitted to
8th Central Pay Commission
on

Retirement Benefits

Q 9 What concerns / views do you face related to Retirement Benefits? Select those which are applicable

• Death Cum Retirement Gratuity (DCRG) under OPS / NPS / UPS
• OROP
• Leave Salary / Encashment
• Pension Commutation
• Any other.

(1376 WORDS & 8256 CHARACTERS)

Death Cum Retirement Gratuity (DCRG) under OPS / NPS / UPS :-

DCRG is currently calculated at 14 of the Basic Pay + DA for each completed 6-month period of qualifying service, subject to a maximum of 16.5 times the emoluments and a monetary ceiling of Rupees 25 Lakhs. This benefit is admissible to Government Employees who retired after completing 5 years of Qualifying service. In cases where a Government Employee dies while in service, the Family is granted Gratuity at prescribed rates. We propose that Gratuity should be calculated on the basis of 25 effective working days instead of 30 days in a month, so that Government Employees are not placed at a disadvantage position compared to employees covered under the Payment of Gratuity Act. Further, the existing ceiling of 16.5 times the emoluments should be removed. This effectively reduces Gratuity for employees who have served beyond 33 years. We further propose that the 8th CPC may recommend to calculate Gratuity at half a month Basic Pay + DA for each completed 6 months period of qualifying service. Considering rising salaries and inflation the maximum gratuity ceiling should be enhanced from Rupees 25 Lakhs to 75 Lakhs. All these revised benefits should be extended to employees covered under NPS & UPS schemes ensuring equitable retirement benefits across all categories of Central Government Employees.

OROP: Extension of OROP principles to civil pensioners.

The Government of India has implemented the One Rank One Pension (OROP) scheme for Armed Forces personnel to remove disparities whereby individuals of the same rank and length of service were receiving different pensions due to retirement at different points in time. This principle ensures that persons of equivalent rank and status receive comparable pensions, irrespective of their date of retirement. Similarly, there already exists complete parity in pension among constitutional authorities such as Judges of the Supreme Court, High Courts, and the Comptroller and Auditor General of India, regardless of their retirement date.

For Civilian Employees, the Vth Central Pay Commission had recommended parity between past and future pensioners. However, disparities have re-emerged. We therefore request the 8th Central Pay Commission to disregard the restrictive provisions introduced through the Validation of the Central Civil Services (Pension) Rules 20245 and reaffirm the principle that all pensioners constitute a single homogeneous class. Accordingly, the OROP principle should be extended to Central Civil Pensioners, ensuring parity in Pension without artificial cut off dates base on retirement. The fitment factor for revision of Pension should be at par with the same recommended for employees.

Leave Salary / Encashment :-

We have already proposed 600 days EL Encashment and also full reimbursement of available HPL of the employees while on Superannuation / Retirement etc.,. The 8th CPC may kindly recommend for the same.

Pension Commutation :-

Restoration of Commutation of Pension after 11 years Request for Review of Rule 10 A of CCS (Commutation of Pension) Rules, 1981.

In accordance with Rule 10 A of the CCS (Commutation of Pension) Rules 1981 Restoration of Commutation Pension is after 15 years. These Rules were framed nearly 39 years ago based on the Financial & Actuarial Parameters prevailing at that time. However, lot of changes have taken place in this 39 years which includes interest rates, life expectancy, mortality rates, death rates, and actuarial risk factors which necessitate a fresh values of the restoration period. The following illustration will give a clear picture.

Recovery of Commuted Value :-

Description	Value
Illustratively for a pensioner aged	61 years (Next Birthday)
Commutation Factor :	8.194
Amount Commuted :	Rs.100
Commuted Value Received :	Rs.9833
Amount Recovered in 10 years :	Rs.12,000
Amount recovered in 15 years	Rs.18,000

Thus, the entire commuted value is recovered within about 10 years and recovery beyond this period results in excess recovery from pensioners. Therefore, restoration of commuted pension after 11 years would be reasonable. Although Commutation is optional, Government as a Model Employer considers this matter from a welfare perspective of the senior citizen who have served the nation and the people rather than a revenue perspective. Many experts body have also recommended for restoration of commuted pension in a shorter period. Many State Government have also reduced the period varying from 12 to 13 years. 5th CPC recommend for 12 years restoration. 2nd National Judicial Commission recommended for 12 Years restoration. Therefore, we propose to the 8th CPC to recommend for restoration of Pension after 11 years or at the age of 71 years whichever is earlier.

It is also to be mentioned here that this issue is pending in the Standing Committee of National Council JCM, where in the official side has agreed to consider this issue but unfortunately not yet resolved. Extract from Kerala State Government Service Rules part III is enclosed as Annexure II where in commuted pension is restored after 12 years. The Gujarat Government order dated 12/10/2022 is enclosed as Annexure III where in commuted pension is restored after 13 years.

Revision of Pension / Family Pension :-

For a decent and dignified life after retirement to support a minimum two member family units full pension should be fixed at 67% of the Last Pay Drawn (LPD) or the Average of the last 10 months emoluments which is more beneficial instead of the present 50%. Accordingly, the Family Pension should be 50% instead of the existing 30%. Period of enhanced family pension may be extended up to 70 years. Parliamentary Standing Committee has recommended Additional Pension of 5% every five years after superannuation. We propose the following for the consideration of the 8th CPC.

Proposed Age-Based Pension Structure:

Age	Proposed Pension
65 Years	70% of Last Pay Drawn (LPD)
70 Years	75% of LPD
75 Years	80% of LPD
80 Years	85% of LPD
85 Years	90% of LPD
90 Years	100% of LPD

Various Supreme Court Judgments especially that of the historical “Nakara Judgment” dated 17/12/1982 that pension is not a bounty or Ex-Gratia but a right and deferred wage and prohibited discrimination amongst pensioners. Excluding the existing pensioners entirely from the Terms of reference of 8th CPC is in sharp contrast to the previous CPC’s and Supreme Court Judgment. Recently the Hon’ble Supreme Court has ruled that pensioners cannot be discriminated when compared to serving employees on benefits like DA / DR etc and such discrimination will amount to violation of Article 14 of the Constitution of India. Therefore the recommendations of the 8th CPC with regard to all pensionary matters should be equally applicable to the pensioners who retired prior to 01/01/2026 and also to the existing family pensioners.

Additional facilities as a welfare measure to be provided to the Pensioners.

1) Considering the escalating House Rent in all the cities and towns and even in rural areas, Pensioners may be given House Rent Allowance. The requirement of housing do not get vanished after retirement.

2) Pensioners may also be extended the benefit of LTC.

3) With increasing age many Pensioners suffer from chronic and debilitating conditions such as Alzheimer’s disease, Dementia, Paralysis, Severe post-surgical disabilities etc. which requires a home nurse / care taker. We propose that the 8th CPC may recommend for Care Taker Allowance based on medical necessity.

4) Pension / Family Pension should be exempted from Income Tax.

5) Railway Concessions for Senior Citizens may be restored.

6) Government may establish elder friendly holiday homes / hostels across the country.

7) Physically Disabled Pensioners / Family Pensioners may be provided physical Assistance and the inevitable mobility cost as special allowance to visit hospitals, diagnostic centers may be recommended

Withdrawal of Contributory National Pension System (NPS) and Unified Pension Scheme (UPS) and restoration of Defined and Non-Contributory Pension Scheme.

The Government decision to replace the Defined and Non-Contributory Pension Scheme by NPS to those employees who joined Central Government service on or after 01.01.2004 is not only going backwards but an illegal step in the light of the Supreme Court ruling that the Pension is as good as right to property and is enforceable. The NPS has already made social security in old age uncertain and dependent on Market forces. The scheme has been compulsorily imposed on a section of the Central Government Employees and it is discriminatory. The subsequent UPS introduced by the Government wef.01.04.2025 was also rejected by the Central Government Employees. Out of more than 26 Lakhs NPS employees only 1.22 Lakhs (around 4.5%) migrated to UPS. Therefore, there is no justification in continuing with NPS / UPS and we propose that NPS / UPS may not be made applicable to the Central Government Employees and all those who have been covered under NPS / UPS may be reverted back to Defined and Non Contributory Statutory Pension Scheme (OPS) under the CCS Pension Rules 1972 (now 2021).