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No Objection With IBA's Proposal To Increase Bank Employees Family Pension: Govt

Department of Financial Service, under Union Ministry of Finance in a circular stated, "Government conveys no objection to the Association advising Public Sector Banks (PSB) to рау family pension at a uniform rate of 30 per cent of pay of the deceased employee, without any ceiling on family pension effective from 1.4.2021."

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The Union Government, on Wednesday, gave green signal to the Indian Bank Association's (IBA) proposal to increase the family pension for bank employees to 30 per cent of the last salary drawn, and to lift the cap on pension.

Debasish Panda, Secretary, Department of Financial Services, Ministry of Finance, on Wednesday, during a press meet addressed by Finance Minister Nirmala Sitharaman said, in continuation of the eleventh bi-partite settlement on wage modification of Public Sector Bank (PSB) employees, which was endorsed by the IBA with the associations on November 11, 2020, there was a proposition for an upgrade of the family pension and this was approved by the Union Finance Minister. 

Department of Financial Service, under Union Ministry of Finance in a circular stated, "Government conveys no objection to the Association advising Public Sector Banks (PSB) to рау family pension at a uniform rate of 30 per cent of pay of the deceased employee, without any ceiling on family pension effective from 1.4.2021."

As per the Union Government, hundreds of thousands of families of PSU bank employees are going to get the advantage and benefits of the enhanced family pension. The government said that this move will further boost employer contribution and they will get financial security to the bank employees under the NPS.

"This will enhance the rate of employers' contribution under the National Pension System (NPS) from the existing 10 per cent of pay plus dearness allowance to 14 per cent thereof in respect of employees covered under NPS, effective from 11.11.2020," the circular stated. 


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iba psb government finance ministry