Mumbai: In a bid to provide relief to families of bank employees, the Government has approved the Indian Banks' Association's (IBA) proposal to increase the family pension to 30 per cent of the last salary drawn.
"This move would make family pension go up to Rs 30,000 to Rs 35,000 per family of bank employees," said Debasish Panda, Secretary, Department of Financial Services, Ministry of Finance, at a press meet addressed by Finance Minister Nirmala Sitharaman in Mumbai on Wednesday.
This is in continuation of the 11th bi-partite settlement on wage revision of public sector bank employees, which the IBA signed with the unions on November 11, 2020.
There was a proposal for the enhancement of family pension and also the employers' contribution under the NPS. The Finance Minister has approved this, he said.
Mr. Panda further said that "earlier the scheme had slabs of 15, 20 and 30 percent 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 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".
The Government has also approved the proposal to increase employers' contribution under the NPS to 14% from the existing 10%.
Thousands of families of PSU bank employees will benefit from the enhanced Family Pension, while the increase in employers' contribution will provide increased financial security to the bank employees under the NPS.
As part of her two-day visit to Mumbai, the Finance Minister reviewed the public sector banks' performance and launched the EASE 4.0 reform agenda for smart banking.