Rs 11,500 crore outgo as Centre clears pay, pension revision for insurers, RBI, NABARD

Retired employees of the RBI and NABARD will also see an increase in pensions, along with payment of arrears.

The government has cleared long-pending wage and pension revisions for employees of public sector general insurance companies, NABARD staff and RBI pensioners.

Under the decision, taken on Friday, public sector general insurance employees will receive a wage increase effective August 1, 2022. The family pension has been fixed at a uniform 30%, while the government's contribution under the National Pension System has been raised to 14%.

The pay and pension revisions for employees and retirees across the financial sector are expected to cost the exchequer more than ₹11,500 crore. Retired employees of the RBI and NABARD will also see an increase in pensions, along with payment of arrears.

A total of 46,322 employees, 23,570 pensioners and 23,260 family pensioners will benefit from this exercise.

"The decision reflects the government’s continued commitment and emphasis on social security and the financial well-being of pensioners, in recognition of their long and dedicated professional service," the finance ministry said in a press release.

Public Sector General Insurance Companies

A total of 43,217 employees would benefit from the wage hike, and as many as 14,615 family pensioners will avail the benefit of an increase in pension. According to the ministry, the total financial outgo towards the insurance companies will be to the tune of ₹8,170 crore. Of which, ₹5,823 crore will be spent towards the arrears of wage revision, ₹250 crore for NPS, and ₹2,097 crore for family pension.

Employees and pensioners of the following public general insurance companies would benefit from the revisions: National Insurance Company Ltd (NICL), New India Assurance Company Ltd (NIACL), Oriental Insurance Company Ltd (OICL), United India Insurance Company Ltd (UIICL), General Insurance Corporation of India (GIC), and Agricultural Insurance Company Ltd (AICIL).

NABARD

Similar to the insurance companies, the pay hike for employees of NABARD will be effective from November 1st 2022 – which would benefit around 3,800 serving and former employees.

"Basic pension/family pension to retirees of NABARD, who were originally recruited by NABARD and retired before 1st November, 2017, have now been brought on par with that of ex-RBI NABARD retirees," the release said.

This exercise entails an additional annual wage bill of around ₹170 crore and total payment of arrears amounting to around ₹510 crore. While, pension revision, would result in a one-time arrear payment of ₹50.82 crore as well as an additional ₹3.55 crore outgo in pension payments every month to 269 pensioners and 457 family pensioners in NABARD.

RBI

The retirees of the Reserve Bank of India (RBI) will benefit from the revision of pension and family pension – both shall be enhanced by 10 percent on basic pension plus dearness relief, with effect from November 1st, 2022.

The revision will benefit a total of 30,769 beneficiaries, comprising 22,580 pensioners and 8,189 family pensioners.

"The total financial implication is estimated at ₹2,696.82 crore, which includes a one-time expenditure of ₹2,485.02 crore towards arrea₹ and a recurring annual expenditure of ₹211.80 crore," the ministry said.