Retirement Benefits

Revision of Pension

Government of India
Ministry of Personnel, Public Grievances & Pensions
Department of Pension & Pensionersí Welfare
New Delhi-110003
Dated the 27th October,1997

Implementation of Governmentís decision on the recommendations of the Fifth Central Pay Commission Revision of pension of pre-1996 pensioners/family pensioners etc.

The undersigned is directed to say that in pursuance of Governmentís decision on the recommendations of Fifth Central Pay Commission, sanction of the President is hereby accorded to the regulation, with effect from 1.1.1996, pension/ family pension of all the pre-1996 pensioners/ family pensioners in the manner indicated in the succeeding paragraphs.


These orders apply to all pensioners/family pensioners who were drawing pension/family pension on 1.1.1996 under the Central Civil Services (Pension) Rules, 1972, CCS (Extraordinary Pension) Rules and the corresponding rules applicable to Railway pensioners and pensioners of All India Services including officers of the Indian Civil Service, retired from service on or after 1.1.1973.


Separate orders will be issued by the Ministry of Defence in regard to Armed Forces pensioners/family pensioners.


These orders do not also apply to retired High Court and Supreme Court Judges and other Constitutional/Statutory Authorities whose pension etc. is governed by separate rules/orders.

3.1 In these orders :
  1. Existing pensioner or Existing Family pensioner means a pensioner who was drawing/entitled to pension/family pension on 31.12.1995.

  2. Existing pension means the basic pension inclusive of commuted portion, if any, due on 31.12.1995. It covers all classes of pension under the CCS (Pension) Rules, 1972 as also Disability Pension under the CCS (Extraordinary Pension) Rules and the corresponding rules applicable to Railway employees and Members of All India Services.

  3. Existing family pension means the basic family pension drawn on 31.12.1995 under the CCS (Pension) Rules and the corresponding rules applicable to Railway employees and Members of All India Services.

  4. Existing Dearness Relief means the relief due to pensioners/family pensioners upto average CPI 1510.


The pension/family pension of existing pre-1996 pensioners/family pensioners will be consolidated with effect from 1.1.1996 by adding together:-

  1. The existing pension/family pension.
  2. Dearness Relief upto CPI 1510 i.e. @ 148%, 111% and 96% of Basic Pension as admissible vide this Department's O.M. No. 42/8/96-P&PW(G) dated 20.3.1996.

  3. Interim Relief I.
  4. Interim Relief II.
  5. Fitment weightage @ 40% of the existing pension/family pension.
    The amount so arrived at will be regarded as consolidated pension/family pension with effect from 1.1.1996. The upper ceiling on pension/family pension laid down in the Department of Pension and Pensionerís Welfare Office Memorandum No 2/1/87-PIC.II dated 14.4.1987 has been increased from Rs. 4500/- and Rs. 1250 to 50% and 30% respectively of the highest pay in the Government (The highest pay in the Government is Rs. 30,000 since 1.1.1996). Since the consolidated pension will be inclusive of commuted portion of pension, if any, the commuted portion will be deducted from the said amount while making monthly disbursements.


Some of the existing pensioners who retired between 31.3.1985 and 31.12.1985 are in receipt of personal pension. The said personal pension will continue to be granted as a separate element and will not be merged into the pension as consolidated above.


Since the consolidated pension/family pension arrived at as per paragraph 4.1. includes dearness relief upto average index level 1510, dearness relief will be admissible thereon only beyond index average 1510 in accordance with the revised scheme of dearness relief for which orders are being issued separately. The two instalments of dearness relief sanctioned earlier from 1.7.1996 and 1.1.1997 in this Department's Office Memorandum No. 42(8)/P&PW(G)/96 dated the 12th September, 1996 and Office Memorandum No. 42(2)P&PW(G)/97 dated the 3rd April, 1997 respectively shall be adjusted against revised Dearness Relief becoming due on the consolidated pension/family pension.


The amount already paid on account of Interim Relief III sanctioned vide this Departmentís Office Memorandum No. 42/18/95-P&PW(G)-Vol.II dated 6.9.1996 will be recovered from the arrears becoming due on consolidation of pension/family pension as in para 4.1. above and sanction of Dearness Relief on consolidated pension/family pension.


Where the consolidated pension/family pension in terms of paragraph 4 above works out to an amount less than Rs. 1275/- the same shall be stepped upto Rs. 1275/-. This will be regarded as pension/family pension with effect from 1.1.1996. In the case of pensioners who are in receipt of more than one pension, the floor ceiling of Rs. 1275/- will apply to the total of all pensions taken together.


Where the disability pension under the CCS(EOP) Rules, is drawn in addition to invalid pension under the CCS (Pension) Rules, 1972, the minimum limit of Rs. 1275/- will apply to total of two pensions as indicated in paragraph 5.1. Where the disability pension is drawn in isolation, the minimum limit of Rs. 1275/- will apply for 100% disability. For lesser degree of disability the minimum limit will be proportionately less.


The employed/re-employed pensioners/family pensioners are not getting dearness releif on pension at present under the extant orders. In their case the notional dearness relief which would have been admissible to them but for their employment/re-employment will be taken into account for consolidation of their pension in terms of paragraph 4.1. above as if they were drawing the dearness relief. Their pay will be re-fixed w.e.f. 1.1.1996 with reference to consolidated pension becoming admissible to them. Dearness relief beyond 1.1.1996 will, however, not be admissible to them during the period of employment/re-employment.


The cases of Central Government employees who have been permanently absorbed in public sector undertakings/autonomous bodies will be regulated as follows:-


Where the Government servants on permanent absorption in public sector undertakings/autonomous bodies continue to draw pension separately from the Government, the pension of such abosrbees will be updated in terms of these orders. In cases where the Government servants have drawn one time lumpsum terminal benefits equal to 100% of their pensions and have become entitled to the restoration of one-third commuted portion of pension as per Supreme Court judgement dated 15.12.1995, their cases will not be covered by these orders.


In cases where, on permanent absorption in public sector undertakings/autonomous bodies, the terms of absorption permit grant of family pension under the CCS (Pension) Rules, 1972 or the corresponding rules applicable to Railway employees/members of All India Services, the family pension being drawn by family pensioners will be updated in accordance with these orders.


8 All Pension Disbursing Authorities including Public Sector Banks handling disbursement of pension to the Central Government pensioners are hereby authorised to pay pension/family pension to existing pensioners/family pensioenrs at the consolidated rates without any further authorisation from the concerned Accounts Officers/Head of Office etc. A table indicating the existing pension, the consolidated pension and difference payable from 1.1.1996 is enclosed for ready reference. (Annexure I). This table may be used where the pensioner is in receipt of a single pension only. Where a pensioner is in receipt of more than one pension, consolidation may be done separately in terms of paragraph 4.1 and as indicated in pargraph 5 floor ceiling of Rs. 1275/- may be applied to total pension from all sources taken together. A suitable entry regarding the revised consolidated pension shall be recorded by the pension Disbursing Authorities in both halves of the Pension Payment Order. An intimation regarding disbursement of revised pension may be sent by the pension disbursing authorities to the Office of CPAO and Accounts Officer which had issued the PPO in the form given at Annexure-II so that the latter can update the Pension payment Order Register maintained by him. An acknowledgement shall be obtained by the Pension Disbursing Authorities from Office of CPAO and the respective Accounts Officers in this behalf.


The consolidated pension/family pension as worked out in accordance with provisions of Para 4.1. above shall be treated as final 'Basic Pension' with effect from 1.1.1996 and shall qualify for grant of Dearness Relief sanctioned thereafter in respect of following categories of pensioners/family pensioners:-

  1. Pensioners, who retired between the period from 1.1.1986 to 31.12.1995.

  2. Family pensioners, who became entitled for family pension during the period from 1.1.1986 to 31.12.1995 and were sanctioned family pension @ 30% of the last pay drawn by the deceased employee.


In case of other pensioners/family pensioners, these orders provide for revision/consolidation of pension with effect from 1.1.1996 as an interim measure only so as to provide them immediate relief and shall be subject to variation. Detailed instructions regarding fixation of their pay on notional basis/revision/consolidation of pension/family pension and issue of authorisation in this regard will be issued separately. Pending issue of detailed instructions as stated above, grant of pension/family pension to all these pensioners/family pensioners may be continued to be regulated under these orders.


The arrears on account of consolidation of pension would be paid in cash with the stipulation that where amount of arrears is less than Rs.5,000/-, it should be paid in one instalment and where it is in excess of Rs.5,000/-, it should be paid in two instalments; in the first instalment, payment should be restricted to Rs.5,000/- plus fifty percent of their balance amount of arrears.


It is considered desirable that the benefit of these orders should reach the pensioners as expeditiously as possible. To achieve this objective it is desired that all pension disbursing Authorities should ensure that the revised pension and the first instalment of arrears due to the pensioners in terms of the above orders is paid to the pensioners or credited to their account by 30th November, 1997 or before positively. Instructions regarding release of second instalment of arrears will be issued later.


In their application to the persons belonging to Indian Audit and Accounts Department these orders issue in consultation with the Comptroller and Auditor General of India.


Ministry of Agriculture etc. are requested to bring the contents of these Orders to the notice of Controller of Accounts/Pay and Accounts Officers and Attached and subordinate Offices under them on a top priority basis. All pension disbursing offices are also advised to prominently display these orders on their notice boards for the benefit of pensioners.

Additional Secretary (Pension)

Form of intimation by the Pension Disbursing Authority to the Central Pension Accounting Office/Pay and Accounts Office regarding consolidation of pension in terms of Department of Pension and Pensioners Welfare Office Memorandum No.45/86/97-P&PW(A)-Pt.-II dated 27.10.1997.

1. Name of the Pensioner/Family Pensioner

2. PPO No.
3. Date of retirement/Death (in case of family pension)
4. Savings Bank A/C No.
5. Name of the Bank/Paying Branch
6. Bank Code No.
7. Computation of consolidated pension/family pension

Pension *Family Pension *Family Pension ( At enhanced rate)

(A) Existing basic pension (inclusive of commuted portion)/Family Pension
(B) Dearness Relief upto CPI 1510 i.e. 148%, 111% and 96% of Pension / Family Pension as drawn.
(C) Ist Interim Relief.
(D) IInd Interim Relief.
(E) 40% of the Basic Pension/Family Pension as at ‘A’ above.
(F) Consolidated Pension/FamilyPension (A+B+C+D+E)

1. The final revision of pension in respect of pensioners retired prior to 1.1.1986 and also those retired after 1.1.1996 will be done by the Pay & Accounts Office concerned
2. The final revision of Family Pension except in case of those who became eligible for family pension during the period 1.1.1986 to 31.12.1995 and were sanctioned the same @ 30% of last pay drawn by the deceased employee, will also be done by the Pay & Accounts Office concerned.

( * If not applicable draw a line across.)

8. Whether consolidated pension/family pension is final or allowed as immediate relief.
9. Remarks, if any.


1. Central Pension Accounting Office
Ministry of Finance,
Department of Expenditure,
Trikoot-II, Bhikaji Cama Place,
New Delhi - 110 066.

2. Concerned Pay & Accounts Office

Department of Personnel and Training
Department of Administrative Reforms & Public Grievances.

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