This issue was raised seriously in the meeting of SCOVA held on 11 March 2025. In the meeting, the Finance Department informed that this issue can now be included in the Terms of Reference (ToR) of the 8th Pay Commission.
Pension News: This can be a good news for central employees, although it is just a discussion right now, but if the government takes a decision on this, then central employees are going to get a huge benefit after retirement, this news is related to the commuted pension received after the retirement of the employee.
When will the Eighth Pension Commission (8th Pay Commission) be effective and when will the employees get salary according to it is not decided yet, but in the meantime an old demand of retired central employees has come into discussion again, this demand is to reduce the years in commuted pension.
Employee organizations have been demanding for a long time that the time for restoration of commuted pension be reduced from 15 years to 12 years, so that retired employees will get relief from this inflation. Recently, the 34th meeting of SCOVA (Standing Committee of Voluntary Agencies) was held in which this demand was again discussed prominently among other discussions.
What is commuted pension
When a central government employee retires, he starts getting pension. The government gives him a facility that if he wants, he can take a large part of the pension at once, this is called commuted pension. It is worth noting here that the monthly pension of the employee who takes a lump sum amount is reduced for a few years. According to the rules currently in force, this reduction continues for 15 years, after which the employee’s full pension is restored, that is, he starts getting full pension.
This is the argument of employee unions
Employee unions and employees taking pension under the commuted pension scheme say that the interest rates are being reduced by the Reserve Bank of India, in view of this, the period of 15 years is now unfair. They say that the Fifth Pay Commission and many state governments have already recommended limiting this period to 12 years. In such a situation, it is also expected from the central government that it should take this decision in the interest of the employees.
