Good News for Central Government Employees: Cabinet Makes Big Changes in Pension Rules

New order comes as a relief to Central Government employees, few of whom were knocking the doors of the courts so as to get covered under the CCS (Pension) Rules, 1972.

Good News for Central Government Employees: Cabinet Makes Big Changes in Pension Rules
CG employees
Good News for Central Government Employees: Cabinet Makes Big Changes in Pension Rules

Central Government Employees: The Department of Pension and Pensioners' Welfare has taken out an order. As per the order, all Central Government employees whose selection for appointment was finalized before 1 January, 2004 but who joined service on or after 01.01.2004, can now opt to be covered in the Central Civil Services (Pension) Rules, 1972 instead of the National Pension System (NPS). 

According to the Minister of Personnel Dr Jitendra Singh, “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 NPS.

He added, “The decision had been taken by the Department of Pensions and Pensioners' Welfare to address the longstanding demand of CG employees whose recruitment was finalized before January 1, 2004 but who had, for different reasons, joined the services on or after January 1, 2004.”

However, it is to be noted that the last date to use this option would be 31 May, 2020. Those who fail to exercise the option by this stipulated date will continue to be covered under the National Pension System.

Central government statement reads, "The CG by this order has rectified a long standing grievance of a huge number of employees whose recruitment (that includes written examination, interview and declaration of result) had been finalized on or before 1 January 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 which were beyond the control of such Government servants." 

This order comes as a relief to several Central Government employees, few of whom were knocking the doors of the courts so as to get covered under the CCS (Pension) Rules, 1972 and will also substantially bring down the litigation on this subject matter.
Please Note: The CG employees who exercise option to switch over to the pension scheme under CCS (Pension) Rules, 1972, will be needed to subscribe to the General Provident Fund (GPF).