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EMPLOYEES’ PENSION
SCHEME – 1995
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Employees' Pension Scheme-95 came into
effect from 16.11.95. The Employees' Pension Scheme-95 has
been conceived as a Benefit defined Social Insurance Scheme
formulated following actuarial principles for ensuring long
term financial sustenance. The new Employees’ Pension
Scheme-95, repealed and replaced the erstwhile Family
Pension Scheme, 1971. The assets and liabilities of the
erstwhile Pension Fund were transferred and merged with the
new Pension Fund. The benefits and entitlements to the
members under the old scheme remain protected and continued
under the new Employees’ Pension Scheme-95.
APPLICATION AND
COVERAGE
The Scheme was notified on 16.11.95 and
made effective from that date with the provision for
retrospective application from 1.4.93 in selective cases.
The Scheme on its introduction applied on compulsory basis
to all the new members of Provident Fund and the existing
members who were contributing to the Employees' Family
Pension Scheme-1971. The existing members (as on 16.11.95)
of the Provident Fund who did not opt for joining the
erstwhile Employees' Family Pension Scheme-1971 and the
beneficiaries under the erstwhile Employees' Family Pension
Scheme-1971 in case of death/exit occurring between 1.4.93
and 15.11.95 have option to join the new scheme.
CONTRIBUTION
No separate contribution is payable
additionally by the member for the Pension Scheme benefits.
The new Pension Scheme, alike the old Employees' Family
Pension Scheme, 1971 derives its financial resource by
partial diversion from the Provident Fund contribution, the
rate being 8.33% in lieu of 2.33% against the old ceased
Family Pension Scheme-1971.The Central Government continues
contributing at the rate of 1.16% as before, on wages at the
end of the year.
BENEFITS
Newly introduced Employees' Pension
Scheme-95 provides for following benefit package:
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Pension for life to the member, on
superannuation/retirement and invalidation.
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To the members of the family upon
death of the member:
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Pension to Widow/Widower for life
or till re-marriage.
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To children/orphan, two at a time
additionally upto 25 years of age simultaneously
with widow/widower pension.
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Children/orphan with total and
permanent disability shall be entitled to payment of
children pension or orphan pension as the case may
be irrespective of age and number of children in the
family.
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Facility for payment of pension
to nominee in the event of member who is unmarried
or without any eligible family member to receive
pension, and
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Facility for payment of pension
to dependent father/mother in the event the member
dies leaving behind no eligible family members and
no nomination by such deceased member exist.
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Facility for capital return (corpus
accretion) on option formula basis
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Commutation of pension up to 1/3rd
of pension amount
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Scheme Certificate to retain
membership of the Scheme till attaining the age of 58
years.
Superannuation/retirement pension under
the new scheme will be payable on fulfilling:-
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Minimum 10 years eligible service
and
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Attaining age of 58 years.
On ceasing employment earlier than 58
years, pension may be availed of by a member at his option,
before attaining the age of 58 years but not below 50 years.
Such early pension will be subject to discounting factor.
However, no such age restriction or eligibility requirement
shall apply for pension entitlement on disablement or
pension payable to the family members on death of the
member. Membership with one contribution is enough in such
cases.
VALUATION OF
PENSION FUND
The Pension Fund is evaluated by an
Actuary on an annual basis. Based on valuation
recommendations, Central Government determines the amount of
relief on pensions to existing pensioners.
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