7th Pay Commission: Good news on pension rules, as govt brings cheer to CG employees

New Delhi, Feb 19: A major decision was taken on the 7th Pay Commission by the Union Government following an important meeting.

The meeting was with the Central Government employees whose recruitment was finalised before January 1 2004, but had joined the services on or after January 1 2004.

The government in its order said that all CG employees whose selection for appointment was finalised before January 1 2004, but who joined service on or after January 1 2004 can now opt to be covered under the Central Civil Services (Pension) Rules 1972 instead of the NPS or National Pension Scheme.

This comes as a major relief for the CG employees who have had to go to court seeking to be covered under the CCS (Pension) Rules, 1972. The order effectively gives those employees of the Government of India who were recruited before 2004 the option of either switch over to the Central Civil Services (Pension) Rules, 1972 or continue to be covered under the National Pension System, a press release said.

The last date to exercise this option would be May 31 2020. If the CG employee fails to exercise this option before the said date, he or she would continue to be covered under the NPS, the order also said.

Read the full order:

The Department of Pension and Pensioners' Welfare has taken out an order through which all Central Government employees whose selection for appointment was finalized before 01.01.2004 but who joined service on or after 01.01.2004, can now opt to be covered under the Central Civil Services (Pension) Rules, 1972 instead of the NPS (National Pension System).

Minister of State (I/C) for the Ministry of Personnel, Public Grievances and Pensions Shri Jitendra Singh said that the order effectively gives those employees of the Government of India who were recruited before 2004 the option of either switch over to the Central Civil Services (Pension) Rules, 1972 or continue to be covered under the National Pension System.

Shri Jitendra Singh further added that the landmark decision had been taken by the Department of Pensions and Pensioners' Welfare to address the longstanding demand of Central Government employees whose recruitment was finalized before 01/01/2004 but who had, for various reasons, joined the services on or after 01/01/2004. However, he noted that the last date to exercise this option would be 31/05/2020, and those who fail to exercise the option by this stipulated date would continue to be covered by the National Pension System.

The Central Government by this order has rectified a long standing grievance of a huge number of employees whose recruitment (including written examination, interview and declaration of result) had been finalized on or before 01.01.2004 (which was the cut-off date for employees to be covered under the old Pension scheme) but whose joining was delayed on account of administrative reasons and such delay was beyond the control of such Government servants.

This order of the Government of India is expected to give relief to several Central Government employees, some of whom were knocking the doors of the Courts in order to get covered under the CCS (Pension) Rules, 1972 and will also substantially bring down the litigation on this subject matter.

A few illustrations where the selection was finalized before 01.01.2004 but actual joining took place on or after 01.01.2004 are as under:

1. The result for recruitment was declared before 01.01.2004 but the offer of appointment and actual joining of the Government servant was delayed on account of police verification, medical examination etc.;
2. Some of the candidates selected through a common selection process were issued offers of appointments and were also appointed before 01.01.2004 whereas the offers of appointments to other selected candidates were issued on or after 1.1.2004 due to administrative reasons/constraints including pending Court/CAT cases.
3. Candidates selected before 01.01.2004 through a common competitive examination were allocated to different Departments/organization. While recruitment process was completed by some Department(s)/organizations on or before 31.12.2003 in respect of one or more candidates, the offers of appointment to the candidates allocated to the other Departments /Organization were issued on or after 01.01.2004.
4. Offers of appointment to selected candidates were made before 01.01.2004 with a direction to join on or after 01.01.2004.
5. Offers of appointment were issued to selected candidates before 01.01.2004, and many/most candidates joined service before 01.01.2004. However, some candidate(s) were allowed extension of joining time and they joined service on or after 01.01.2004. However, their seniority was either unaffected or was depressed in the same batch or to a subsequent batch, the result for which subsequent batch was declared before 01.01.2004.
6. The result for recruitment was declared before 01.01.2004 but one or more candidates were declared disqualified on the grounds of medical fitness or verification of character and antecedents, caste or income certificates. Subsequently, on review, they were found fit for appointment and were issued offers of appointment on or after 01.01.2004.

In all the above illustrative cases, since the result for recruitment was declared before 01.01.2004, denial of the benefit of pension under CCS (Pension) Rules, 1972 to the affected Government servants is not considered justified.s

It has been decided that in all cases where the results for recruitment were declared before 01.01.2004 against vacancies occurring on or before 31.12.2003, the candidates declared successful for recruitment shall be eligible for coverage under the CCS (Pension) Rules, 1972.

Accordingly, such Government servants who were declared successful for recruitment in the results declared on or before 31.12.2003 against vacancies occurring before 01.01.2004 and are covered under the National Pension System on joining service on or after 01.01.2004, may be given a one-time option to be covered under the CCS (Pension) Rules, 1972. This option may be exercised by the concerned Government servants latest by 31.05.2020.

Those Government servants who are eligible to exercise option in accordance with para-4 above, but who do not exercise this option by the stipulated date, shall continue to be covered by the National Pension System and the option once exercised shall be final.

The matter regarding coverage under the CCS (Pension) Rules, 1972 based on the option exercised by the Government servant shall be placed before the appointing authority for consideration in accordance with these instructions. In case the Government servant fulfils the conditions for coverage under the CCS (Pension) Rules, 1972, in accordance with these instructions, necessary order in this regard shall be issued latest by 30th September, 2020. The NPS account of such Government servants shall, consequently, be closed w.e.f. 01st November, 2020.

The Government servants who exercise option to switch over to the pension scheme under CCS (Pension) Rules, 1972, shall be required to subscribe to the General Provident Fund (GPF).

This order would come as a major relief for the CG employees. Meanwhile there is still no development of a pay hike of Rs 26,000. The 7th Pay Commission had recommended the pay hike at Rs 18,000.