FM Nirmala Sitharaman hikes PSBs' pension contribution for employees to 14%

In a bid to provide relief to families of bank employees, the Centre has okayed the Indian Banking Association’s (IBA) proposal to increase the family pension to 30% of the last salary drawn.

This move would make family pension go up to as much as Rs 30,000 to Rs 35,000 per family of bank employees.

This was announced by the Department of Financial Services Secretary Debasish Panda at a press meet addressed by Finance Minister Nirmala Sitharaman in Mumbai on Wednesday.

According to him, in continuation of the 11th bi-partite settlement on wage revision of public sector bank employees, which was signed by the IBA with the unions on November 11 last year, there was a proposal for enhancement of family pension and also the employers' contribution under the National Pension Scheme.

"This has been approved by the Finance Minister," he said.

Panda further said that earlier the scheme had slabs of 15, 20 and 30 per cent of the pay that a pensioner drew at that point of time. It was capped subject to a maximum of Rs 9,284.

“That was a very paltry sum and the Finance Minister was concerned and wanted that to be revised so that family members of bank employees get a decent amount to survive and sustain,” he noted.

The Government has also approved the proposal to increase employers contribution under the New Pension Scheme to 14% from the existing 10%.

Thousands of families of PSU bank employees will be benefited from the enhanced Family Pension, while increase in employers contribution will provide increased financial security to the bank employees under the New Pension Scheme.