PIB NEWS ON GRATUITY CEILING INCREASE UP TO RS. 20 LAKH
Ministry of Labour & Employment
Payment of Gratuity (Amendment) Bill, 2018 passed by Parliament
The Payment of Gratuity (Amendment) Bill, 2018 has been passed by parliament today. The bill ensures harmony amongst employees in the private sector and Public Sector Undertakings/Autonomous Organizations under Government who are not covered under CCS (Pension) Rules. These employees will be entitled to receive higher amount of gratuity at par with their counterparts in Government sector. The bill was passed by the Rajya Sabha today and the Lok Sabha on 15 March, 2018.
The Payment of Gratuity Act, 1972 applies to establishments employing 10 or more persons. The main purpose for enacting this Act is to provide social security to workman after retirement, whether retirement is a result of superannuation, or physical disablement or impairment of vital part of the body. Therefore, the Payment of Gratuity Act, 1972 is an important social security legislation to wage earning population in industries, factories and establishments.
The present upper ceiling on gratuity amount under the Act is Rs. 10 Lakh. The provisions for Central Government employees under Central Civil Services (Pension) Rules, 1972 with regard to gratuity are also similar. Before implementation of 7th Central Pay Commission, the ceiling under CCS (Pension) Rules, 1972 was Rs. 10 Lakh. However, with implementation of 7th Central Pay Commission, in case of Government servants, the ceiling has been raised to Rs. 20 Lakhs.
Therefore, considering the inflation and wage increase even in case of employees engaged in private sector, this Government decided that the entitlement of gratuity should also be revised in respect of employees who are covered under the Payment of Gratuity Act, 1972. Accordingly, the Government initiated the process for amendment to Payment of Gratuity Act, 1972 to increase the maximum limit of gratuity to such amount as may be notified by the Central Government from time to time.
In addition, the Bill also envisages to amend the provisions relating to calculation of continuous service for the purpose of gratuity in case of female employees who are on maternity leave from ‘twelve weeks’ to such period as may be notified by the Central Government from time to time.
After enactment of the Act, the power to notify the ceiling of the amount of gratuity under the Payment of Gratuity Act, 1972 shall stand delegated to the Central Government so that the limit can be revised from time to time keeping in view the increase in wage and inflation and future pay commissions.
MAJOR CHANGES IN NPS – RELAXATION NORMS
Relaxation of Norms for NPS
The Government of India has recently made three changes in the National Pension Scheme (NPS) including withdrawal norms. The details are as under:
Partial withdrawal during the service: The Pension Fund Regulatory and Development Authority (PFRDA), with an objective to meet the subscriber’s sudden financial requirement enrolled under NPS, has liberalized norms for partial withdrawals which also include reduction of requirement of minimum years of being enrolled under NPS from 10 years to 3 years from the date of joining. Suitable amendments were made through “Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) (First Amendment) Regulations, 2017 and the same has been notified on 10.08.2017.
Increase in the joining age under NPS: With an objective to allow individuals (under NPS-All Citizen Model and Corporate Sector Model) who are in the age bracket between 60 years and 65 years to join NPS system. Suitable amendments were made through “Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) (Second Amendment) Regulations, 2017 and the same has been notified on 06.10.2017.
Exit in case of disability and incapacitation of the subscriber: With an objective of facilitating easy exit & withdrawal in case of disability and incapacitation of the subscriber covered under NPS, PFRDA has made suitable amendments through “Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) (Third Amendment) Regulations, 2018 and the same has been notified on 02.02.2018.
This was stated by Shri Ship Pratap Shukla, Minister of State for Finance in a written reply to a question in Lok Sabha today.
AADHAAR IS NOT COMPULSORY TO GET PENSION
Dr. Jitendra Singh chairs 30th meeting of Standing Committee of Voluntary Agencies
Adhaar is not mandatory to get pension: Dr Jitendra Singh
The Union Minister of State (Independent Charge) for Development of North Eastern Region (DoNER), MoS PMO, Personnel, Public Grievances, Pensions, Atomic Energy and Space, Dr. Jitendra Singh chaired the 30th meeting of the Standing Committee of Voluntary Agencies (SCOVA) here today. The SCOVA meeting is organised by the Department of Pensions & Pensioners’ Welfare (DoP&PW), Ministry of Personnel, Public Grievances & Pensions and the last such meeting was held on January 12, 2017.
During the meeting, Dr. Jitendra Singh said that the SCOVA which was first constituted in July, 1986 would be completing 32 years this year. He said this platform has gone a long way in addressing in a focused manner issues related to Pensioners. He said that today’s interaction was very meaningful and stimulating, thus reflecting on the working of DoP&PW. The Minister while assuring the representatives of pensioners’ Associations said that it was no more mandatory to have one’s Adhaar Card to get his/her pension.
The Minister said that the Department of Pensions has brought out a series of OMs to benefit the Pensioners/Family Pensioners in the last 12 months including enhancing of minimum pension from Rs.3500/- to Rs.9000/- per month; the ceiling of gratuity has been increased from the existing Rs.10 lakhs to Rs.20 lakhs; the rates of ex-gratia lump sum compensation being paid to the families of employees who die in performance of duty has been increased from existing Rs. 10-15 lakhs to Rs.25-45 lakhs. He also said that divorced daughter will be eligible for family pension if divorce case has been filed before the death of pensioner/family pensioner, even though the judgment has been passed after the death of the pensioner /family pensioner.
Dr. Jitendra Singh said that this Government has given relief to the senior citizens and Pensioners in the Budget 2018-19 by allowing Standard Deduction of Rs. 40,000/- per year to the Pensioners and given exemption on tax on account of interest income from bank savings accounts has been increased to Rs. 50,000/ from Rs. 10,000/- per year. Deduction on account of health insurance premium which was earlier allowed at maximum of Rs.30,000/- has now been increased to Rs. 50,000/- in the case of Senior Citizens/Pensioners.
While addressing the meeting he said that we need to put in place an institutionalized mechanism to make good use of the knowledge, experience and efforts of the retired employees which can help in the value addition to the current scenario. Dr. Jitendra Singh said the retired employees are a healthy and productive workforce for India and we need to streamline and channelize their energies in a productive direction. We should learn from the pensioners’ experience, he added. The Minister also said that the DoP&PW should be reoriented in such a way that pensioners become a part of nation building process.
In the meeting, discussions were held on the action taken report of the 29th SCOVA meeting. Further many issues related to pensioners were discussed threadbare, such as revision of PPOs of pre-2006 pensioners, Health Insurance Scheme for pensioners including those residing in non-CGHS area, Special “Higher” Family Pension for widows of the war disabled invalidated out of service, Extension of CGHS facilities to P&T pensioners, issue relating to CGHS Wellness Centre, Dehradun etc. The Minister directed for the prompt and time bound redressal of the grievances of the pensioners and said that we should have sympathetic attitude towards them.
The Secretary, DoP&PW, Shri K.V. Eapen and other senior officers of the department were also present on the occasion. The meeting was also attended by the member Pensioners Associations and senior officers of the important Ministries/Departments of Government of India.