EPFO move to cause one-third cut in Higher Pension for 13 lakh

” EPFO move to cause one-third cut in Higher Pension for 13 lakh.”

The above news appeared yesterday evening i.e., on 07-11-2023, in WhatsApp Groups including EPS,’95 Seva Group of Sri Parveen Kohliji.

Let us examine the case of a Live Example, the calculation of which was done by P.F. Commissioner, Cuddapah, Andhra Pradesh, and informed the party in the “letter head” of the P.F. Commissioner.

Please note that the Employee opted for Higher Pension inbetween 16-03-1996 and 30-11-2004, as per the Gazette Notification of 16th March, 1996, Regular Higher recoveries were remitted every month to EPFO during the service of the employee.

(Name and PPO No is withheld due to privacy purpose)

Date of Birth…………………………14-08-1959.
Date of joining………………………19-04-1979.
Date of attainining 58 years…..13-08-2017.
Wages as on 15-11-1995………..3,400/-
Contributory Service under
EFPS,’71………………………………….16 years, 6 months and 26 days.
(19-04-1979 to 15-11-1995)
Contributory Service under
EPS,’95……………………………………21 years, 8 months and 1 day.
(16-11-1995 to 13-08-2017)
Non-Contribution period from
16-11-1995 to 13-08-2017……..28 days.
Last 60 month average Wages from
September, 2012 to August, 2017……..36,389/-

Pension under EFPS,’71: 135X5.231=706/-*

Pension under EPS,95:
16-11-1995 to 13-08-2017:
a) 16-11-1995 to 30-11-1995: 16 days.
b) 01-12-1995 to 30-11-2016: 21 years.
c) 01-12-2016 to 31-07-2017: 8 months.
d) 01-08-2017 to 13-08-2017: 13 days.
16+21X365+8X30+13=16+7,665+240+13=7,934 days.

• 2 years Weightage (365X2)=730=8,664(-)28 (NCP)=8,636 days.
  36,389/25,550(365X70)X8,636=12,300*
  706+12,300=13,006/-* (as per last 60 months average for the entire Contributory Period of 16-11-1995 to 13-08-2017)
  Total Pension on average 60 months for the entire period of 16-11-1995 to 13-08-2017: 706+12,300=13,006/-*

Now on Pro-rata basis:
Note: The Non-Contributory period is to be divided into two parts:
a) 16-11-1995 to 31-08-2014.
b) 01-09-2014 to 13-08-2017.
There is no bifurcation in PPO and only one figure is shown for the entire period of 16-11-1995 to 13-08-2017.
Suppose an employee is under Suspension, removal and re-entered service due to a) Court Judgement/appeal to Higher authorities etc.
Non-Contributory period in the above case as an example: 01-08-2012 to 30-09-2016 due to suspension followed by removal and time taken to decide the appeal by Court/Higher Authorities)
Bifurcation of NCP:
a) 01-08-2012 to 31-08-2014: 2 years, 1 month.
b) 01-09-2014 to 30-09-2016: 2 years, 1 month.

Average last 12 months Wages from September, 2013 to August, 2014: 37,123/-
Average last 60 months Wages from September, 2012 to August, 2017: 36,389/-

Contributing days from 16-11-1995 to 31-08-2014: 6,856 days: 16D+18Y+9M=16+6,570+270=6,858 days.
Contributing days from 01-09-2014 to 13-08-2017: 1,073 days: 2 years, 11 months and 13 days: 730+330+13=1,
Total: 1,073 days (-) 28 days=1,045 days.

Pension calculation:
a) 37,123/25,550 (365X70)X6,856=9,961/-*
b) 36,389/25,550 (365X70)X1,045=1,488/-*
Weightage on Pro-rata basis:
37,123/70X2X6,856/7,901 (6,856+1,045)=920/-*
36,389/70X2X1,045/7,901 (6,856+1,045)=138/-*
9,961+1,488+920+138=12,507/-*
706 (EFPS,’71)+12,507/-(EPS,’95)=13,213/-
Earlier sanctioned: 13,006/-, excess: 207/- excess to be paid due to calculation of Pro-rata basis from 14-08-2017 to 31-10-2023 with arrears,

G. Srinivasa Rao, Mobile No: 89851 72459 & WhatsApp No: 6300114361.