Why the EPS 1995 Formula Needs a Rethink: Impact of Amended Pension Rules on Divisor 70

RTI Reply on EPS 1995 Formula

The RTI reply from the Ministry of Labour & Employment (MoL&E) via Letter F.No. S-65016/2/2018-SS-II(Pt.) dated 22.05.2019, in response to RTI Online Request MLABE/R/2019/50668 dated 01.05.2019, regarding the genesis of the Factor (Divisor) 70 in the EPS 1995 formula, along with the RTI application, is included in the attachment.

As per the CCS (Pension) Rules 1972, 33 years were initially required to receive a 50% pension in 1995 when the EPS '95 came into effect on 16.11.1995. However, according to the amended CCS (Pension) Rules 1972, only 20 years are now required to receive a 50% pension effective from 01.01.2006. Therefore, this Factor (Divisor) 70 needs to be re-evaluated in accordance with the amended CCS (Pension) Rules 1972 by the competent authority to improve the conditions for members under EPS '95.

Understanding the Amended CCS (Pension) Rules 1972

🔍 Background:
The query pertains to the evolution of pension rules under the Central Civil Services (Pension) Rules 1972, specifically focusing on the eligibility period for receiving 50% pension under the Employees' Pension Scheme (EPS) '95.

💡 Insight:
- In 1995, when the EPS '95 was introduced, the requirement for receiving 50% pension stood at 33 years.
- However, with the amended CCS (Pension) Rules 1972 effective from 01.01.2006, the eligibility period has been reduced to 20 years for attaining 50% pension benefits.

📝 Action Needed:
- The query highlights the discrepancy in the Factor (Divisor) 70 used in the EPS '95 formula, suggesting a need for its reassessment in alignment with the revised pension rules.
- It is recommended that the Competent Authority reexamines the Factor (Divisor) 70 to ensure it reflects the updated provisions of the Amended CCS (Pension) Rules 1972 for the benefit of EPS '95 members.

🚀 Next Steps:
1. Review the RTI reply and the attached documents for a comprehensive understanding of the issue.
2. Identify the specific implications of revisiting the Factor (Divisor) 70 on pension calculations for EPS '95 members.
3. Advocate for a timely review by the Competent Authority to align the EPS '95 formula with the current pension regulations.

By addressing this discrepancy, EPS '95 members can potentially benefit from a more accurate and equitable pension calculation process in line with the latest legislative changes.