Budget 2024-25: Salary Increase Up to 15%
In the forthcoming 2024-25 budget, the government is contemplating a salary increase of 10 to 15 percent for public sector employees. This move is part of a broader plan to introduce comprehensive pension reforms, including limitations on multiple pensions.
The Ministry of Finance is keen on a modest 10 percent salary hike. However, due to potential pressures, the increase could be adjusted to 12.5 or even 15 percent.
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Senior Officer Car Monetization Increase (BPS 20, 21, 22)
For senior officers of grades 20, 21, and 22, the government is also considering a 20 to 25 percent increase in car monetization. Currently, officers of these grades are monetizing cars at monthly rates of 67,000, 77,000, and 87,000 rupees respectively.
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Taxation on High Pensions (Over 1 Lakh Rupees)
The government is prepared to roll out pension reforms in the next budget. One proposal under review is to tax pensioners receiving over one lakh rupees per month. The government might introduce different tax slabs for higher pension recipients.
Extension of Retirement Age for Public Sector
Another proposal is to extend the age limit for public sector employees by two to five years. This would be part of a comprehensive pension reform package.
Lump-Sum Pension Option for Federal Employees
Under the proposed reforms, federal government employees could be eligible for a lump-sum pension. This would be based on 70 percent of the average pensionable emoluments earned during the last thirty-six months before retirement.
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Early Retirement with Reduced Pension
Government employees could opt for early retirement after 25 years of service. However, they might face a penalty of 3 percent per year for the reduction in lump-sum pension from the year of retirement to the age of retirement.
Family Pension Regulations (Duration, Martyrs, Disabled Children)
Family pensions, following the death or disqualification of the spouse, could be granted to the remaining family for a maximum period of 10 years. In the case of a martyr’s pension, the family could receive it for up to 20 years. For disabled/special children of any pensioner, the family pension could be granted for the lifetime of such children.
Pension Option for Re-employed Government Retirees
Federal government employees could be given the option to reduce their lump-sum pension by up to 25 percent at the time of retirement. If a federal government pensioner is re-employed/posted after retirement, they could choose to retain the pension or draw the salary of the said employment during the period of employment. If a person becomes entitled to more than one pension, they could choose to receive any one of the pensions.
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