Kerala’s new full pension scheme: 50% of last salary for Govt staff with 30 yrs service from April 1

Thiruvananthapuram: The State Government has issued an order to implement a new pension scheme from April 1 that guarantees government employees 50% of their last basic salary as pension. The order, however, does not specify details regarding the contributions required from employees and the government, or other full benefits. It has been informed that detailed orders will follow.

Employees with 30 years of service will be eligible for the maximum pension. Relief for financial hardship will also be provided. Current participants in the contributory pension scheme, as well as those recruited from April 1 this year, may opt for the new pension scheme. Those wishing to continue with the contributory pension may do so. At present, 2.4 lakh employees are enrolled in the contributory pension scheme.

The government has decided to implement the new pension scheme with a 10% deduction from employees’ salaries, as in the contributory pension scheme. The government will contribute an equal share. However, this is not mentioned in the order, and it is unclear whether there will be any change in the contribution.

The government has promised that all benefits currently available under the statutory pension will be included in the new scheme. Statutory pension provided a minimum pension for employees with 10 years of service. The new order does not mention details such as pension commutation, pensions for the families of deceased employees, or death-cum-retirement gratuity. The Finance Department has explained that a few more days are needed to calculate pension liabilities, which is why these aspects are not mentioned. Employees will be able to make their choice from April onwards.

Meanwhile, employee organisations have expressed dissatisfaction with the lack of details in the order. During the first Pinarayi government, it was promised that the contributory pension scheme introduced by the UDF under the Oommen Chandy administration would be reconsidered. However, the statutory pension was not restored. The new pension scheme has been designed without completely abolishing the contributory pension scheme.