NE BUSINESS BUREAU
NEW DELHI, FEB 26
The Labour Ministry has implemented retirement fund body Employees’ Provident Fund Organisation (EPFO) decision to restore pension commutation under the Employees’ Pension Scheme, a move that will benefit 6.3 lakh pensioners. Pension commutation refers to part-withdrawal of the fund in advance by a subscriber, who then gets a reduced pension amount for 15 years. With the ministry’s latest decision, such pensioners would receive their full pension after completion of 15 years.
On February 20, the ministry notified the decision of the Employees’ Provident Fund Organisation (EPFO) to restore the pension of those who opted for commutation of their pension on or before September 25, 2008. In this regard, the Employees’ Pension Scheme — run by the EPFO — has been amended.
As many as 6.3 lakh pensioners had opted for commutation of their pension and got a lump sum at the time of retirement from their pension fund on or before September 25, 2008. The provision for pension commutation of pension was withdrawn by the EPFO earlier. Now, the facility has been restored for all those who opted for it on or before September 25, 2008.
Under the commutation, monthly pension used to be cut by one-third for the next 15 years and the reduced amount was given in lump sum. After 15 years, pensioners were entitled to get the full pension. In August 2019, the EPFO’s apex decision-making body — Central Board of Trustees headed by the Labour Minister — approved the proposal to restore commutation of pension.
