Master Circular - Disbursement of Government Pension by Agency Banks - আরবিআই - Reserve Bank of India
Master Circular - Disbursement of Government Pension by Agency Banks
RBI/2015-16/63 July 1, 2015 All Agency Banks Dear Sir/Madam Master Circular - Disbursement of Government Pension by Agency Banks Please refer to our Master Circular RBI/2014-15/110 dated July 1, 2014 on the above subject. We have now revised and updated the Master Circular which consolidates important instructions on the subject issued by the Reserve Bank of India till June 30, 2015. 2. A copy of the revised Master Circular is enclosed for your information. This circular may also be downloaded from our website /en/web/rbi/notifications/master-circulars. Yours faithfully (G. Sreekumar) Encl.: As above Master Circular – Disbursement of Government Pension by Agency Banks Introduction Payment of pension to retired government employees, including payment of basic pension, increased Dearness Relief (DR), and other benefits as and when announced by the governments, is governed by the relevant schemes prepared by concerned Ministries/Departments of the Government of India and State Governments. This Master Circular consolidates important instructions on the subject issued by the Reserve Bank till June 30, 2015. It does not replace or supersede such existing government instructions. In case of any doubt or apparent contradiction, agency banks may be guided by the relevant government instructions. Various circulars issued in this connection by the Reserve Bank of India are summarised hereunder for information. General Instructions (a) Government orders on DR, etc. on websites 2. In order to obviate the time lag between issue of DR orders and payment of DR to the beneficiary and to render expeditious service to senior citizens, the following action is required to be taken:
(b) Nomination 3. With a view to avoiding inconvenience to pensioners, all pension paying branches to accept Nomination Forms ‘A’ or ‘B’ as the case may be, submitted by Central Civil/Railway pensioners for the payment of arrears of pension to the heir(s). 4. In the case of Central Civil and Railway pensioners, the pension paying banks should endorse the names of nominees as per nomination forms ‘A’ and ‘B’ on the front page of the pass book and the branches may be advised to ensure that the procedure laid down in Schemes for disbursement of pension to pensioners by public sector banks are followed scrupulously. (c) All India Service officers retiring from Government of India 5. The accounting procedure to be followed for payment of pension to All India Service Officers retiring from Government of India while on Central Deputation is given below:
(d) Credit of pension to joint account 6. Various Central Government ministries such as Ministries of Defence, Railways and Telecom, and State Governments such as Andhra Pradesh, Arunachal Pradesh, Assam, Maharashtra, Odisha, Punjab, Uttarakhand, Uttar Pradesh, and West Bengal, have modified the scheme for payment of pension permitting credit of pension also to a joint account operated by pensioner with his/her spouse in whose favour an authorisation for family pension exists in the Pension Payment Order (PPO). The joint account of the pensioner with the spouse could be operated either by 'Former or Survivor' or 'Either or Survivor' basis subject to the following terms and conditions:
7. Existing pensioners desiring to get their pension credited to a joint account as indicated above are required to submit an application to the bank branch, from where they are presently drawing pension in the prescribed form. This would also be signed by the pensioner's spouse in token of having accepted the terms and conditions laid down by the Ministry/Government concerned. The facility is applicable to existing / future pensioners. 8. The scheme of some states/ministries add that opening of joint account with any other person for credit of pension, except the spouse in whose favour family pension is authorised in the PPO, shall not be permissible. Family pensioners are also not covered under the revised scheme. For specific details, the scheme of each individual Ministry/State Government may be examined. (e) Issue of Pension Slip 9. It has been decided by Central Pension Accounting Office (CPAO)/Ministry of Defence/Railway and Governments of West Bengal, Goa and Kerala to issue pension slips to their pensioners including family pensioners. Accordingly, pension slips as per the prescribed format are to be issued to these pensioners/family pensioners at the commencement of pension and thereafter, whenever there is a change in quantum of pension. Both halves of the Pension Payment Order (PPO) would also need to be updated. All agency banks were advised to issue suitable instructions to their pension paying branches. (f) Staggering of pension payments 10. Payment of pension only on the last day of the month causes much hardship to pensioners as they have to wait in queue for a long time to collect their pension. As per instructions issued in 1995, agency banks were advised to spread disbursal of pension over the last four working days of the month, except for the month of March, which will continue to be credited on or after the first working day of April. (g) Recovery of excess/wrong payment made to a pensioner 11. Details of the uniform procedure evolved for recovery of excess/wrong payments made to pensioners drawing pensions under the Scheme for payment of pension to Central /Civil/Defence/Railways pensioners through public sector banks, are given below: a) As soon as the excess/wrong payment made to a pensioner comes to the notice of the paying branch, the branch should adjust the same against the amount standing to the credit to the pensioner’s account to the extent possible including lumpsum arrears payment. b) If the entire amount of overpayment cannot be adjusted from the account, the pensioner may be asked to pay forthwith the balance amount of overpayment. c) In case the pensioner expresses his inability to pay the amount, the same may be adjusted from the future pension payments to be made to the pensioners. For recovering the overpayment made to pensioner from his future pension payment in instalments 1/3rd of net (pension + relief) payable each month may be recovered unless the pensioner concerned gives consent in writing to pay a higher instalment amount. d) If the overpayment cannot be recovered from the pensioner due to his death or discontinuance of pension then action has to be taken as per the letter of undertaking given by the pensioner under the scheme. e) The pensioner may also be advised about the details of over payment/wrong payment and mode of its recovery. (h) Refund of excess pension payment to Government 12. Whenever any excess / overpayment is detected the entire amount thereof should be credited to the Government account in lump sum immediately when the excess/overpayment is due to an error on the part of the agency bank. If the excess/wrong payment to the pensioner is due to errors committed by the government, they may take up the matter with the full particulars of the cases with respective Government Department for a quick resolution of the matter. However, this must be a time bound exercise and the government authority’s acknowledgement to this effect must be kept on the bank’s record. The banks may take up such cases with government departments without reference to the Reserve Bank of India. (i) Withdrawal of pension by old/ sick/ disabled/ incapacitated pensioners 13. In order to take care of problems/ difficulties faced by sick and disabled pensioners in withdrawal of pension / family pension from the banks, agency banks may categorise such pensioners as under:
14. With a view to enabling such old/sick/incapacitated pensioners to operate their accounts, banks may follow the procedure as under:
Accordingly, the agency banks are requested to instruct their branches to display the instructions issued in this regard on their notice board so that sick and disabled pensioners could make full use of these facilities. Banks are also advised to sensitise staff members in the matter and to refer to the FAQs on pension disbursement hosted on our website www.rbi.org.in in case of any doubt. (j) Reimbursement of pension payments 15. Link branches of agency banks may submit reimbursement claims to Reserve Bank of India, Public Accounts Departments/ Central Accounts Section, Nagpur for Central/State Government pension payments. (k) Continuation of either or survivor pension account after death of pensioner 16. All agency banks disbursing Central Government pension have been advised that in case the spouse (Family pensioner) opts for existing joint account for credit of family pension, banks should not insist on opening a new account when the spouse is the survivor and having a joint account with the pensioner and in whose favour an authorisation for payment of family pension exists in the Pension Payment Order (PPO). (l) Digital Life Certificate 17. As per the present pension scheme, pensioners are required to furnish a life certificate to the pension disbursing bank every year in November. In view of the difficulties faced by pensioners in submission of these certificates, and in order to alleviate these difficulties, the Government of India has since launched “Jeevan Pramaan”, a digital life certificate based on Aadhaar Biometric Authentication on November 10, 2014. In order to facilitate Jeevan Pramaan, a web portal (jeevanpramaan.gov.in) was launched on November 10, 2014. All agency banks disbursing government pension may take necessary steps to implement and benefit from the scheme and issue necessary instructions to all their branches concerned and dealing staff. They are requested to work towards creating awareness about this facility amongst their pensioner customers through their branches, websites and other means. Banks may also suitably amend the FAQs on pension payments. 18. There have been complaints that life certificates submitted over the counter of pension paying branches are misplaced causing delay in payment of monthly pensions. In order to alleviate the hardships faced by pensioners, agency banks were instructed to mandatorily issue duly signed acknowledgements. They were also requested to consider entering the receipt of life certificates in their CBS and issue a system generated acknowledgement which would serve the twin purpose of acknowledgement as well as real time updation of records. Payment of Central Civil Pension (a) Pension Payment Orders 19. Some of the Pension Paying Bank branches do not update the amount of basic pension/family pension whenever there is change in basic rates in both halves of the Pension Payment Order (PPO) concerned. In this connection, paragraphs 12.17 and 19.1 of the "Scheme for Payment of Pensions to Central Government Civil Pensioners by Public Sector Banks” are reproduced below: “Whenever there is change in the basic rates of pension and/or dearness relief on pension, the paying branch shall call back the pensioner's half of the PPO and record thereon the changes, indicating, inter-alia, the date(s) from which the changes are effective. After this is done, those halves will be returned to the pensioners.” (Para 12.17). “Whenever any additional relief on pensions is sanctioned by Government, an intimation to this effect will be sent by the Ministry of Personnel, Public Grievances and Pensions (Department of Pension and Pensioners' Welfare) to the authorised representative (by name) of each nominated public sector bank at the address given by the latter. Thereafter, it shall be the responsibility of the banks to collect through their representatives operating at Delhi or otherwise, the required number of copies (to be intimated in advance) of the sanction orders, along with the ready-reckoner relating thereto, from the Ministry of Personnel, Public Grievances and Pensions (Department of Pension and Pensioners' Welfare) and send them immediately to their respective Head Offices for direct transmission to the paying branches within ten days for implementation. Each paying branch will promptly determine the revised rates of relief on pensions payable to the Central Government Civil Pensioners under its payment. The calculations of these rates applicable to individual pensioners would be made as in Annexure XXII (Page 41) and they will be noted in disburser's portion of the PPOs along with the date from which relief would take effect, under attestation by the Branch Manager or In-Charge before commencing payment of relief at the revised rates and/or payment of arrears, if any, due to the pensioners on this account…” (Para 19.1). Agency banks may draw the attention of their pension paying branches to the above provisions and advise them to strictly follow the instructions. Payment of pension to Defence pensioners (a) Delay in submission of pension payment scrolls 20. The procedure for transmission of pension payment scrolls by paying branches, link branches and reimbursing branches is stipulated in paragraphs 9(6), 10 and 11 of the booklet “Scheme for Payment of Pension to Defence Pensioners”. The entire procedure detailed therein needs to be completed as per the timeframe fixed so that the payment scrolls are received at the Office of the PCDA (Pension), Allahabad latest by 15th of the following month (except for the month of March scrolls, which should invariably reach latest by 3rd week of every year). The Pension Paying Branches/ Link Branches / Reimbursing Branches are advised to put in place a more efficient system to ensure the following:
(b) Fake and fraudulent payments 21. The Office of the PCDA (Pension) has also noticed that in some cases of payment of gratuity and commutation amount were made to imposters on fake and fraudulent PPOs by the pension paying branches without observing prescribed checks. (c) First payment of pension 22. It has also been observed that in the cases of first payment of pension, either PPO numbers were not mentioned on the scrolls or incorrect PPO numbers were mentioned making it difficult to verify the correctness of the payment. Further, these payments were being shown in the main pension payment scrolls along with the regular monthly payments of Defence Pensioners. The Pension Paying Branches/ Link Branches / Reimbursing Branches are advised to put in place a more efficient system to ensure the following:
(d) Single Window System 23. It has been decided in consultation with the Office of Principal Controller of Defence Accounts (Pension) to introduce Single Window System for reimbursement of Defence Pension with effect from April 1, 2007. Hence, the Reimbursing Banks i.e. RBI (PADs), SBI and its associate banks will cease to reimburse Defence pension payments made by the banks with effect from April 1, 2007. Pension payments transactions may be reported through Link Cell in Nagpur to Central Accounts Section, Reserve Bank of India, Nagpur for fund settlement as in the case of Central Civil Pension. The agency banks are required to send the Payment scrolls to the office of the PCDA (P), Draupadi Ghat, Allahabad. 24. All the past transactions remaining outstanding prior to April 1, 2007 for which Pension Payment Scrolls Advices are wanting shall be resolved through Reimbursing Branches of RBI/SBI and its Associates. Payment of Pension to Railway Pensioners (a) Fake and fraudulent payments 25. The Ministry of Railways has detected cases of fraud wherein pension/ pension arrears have been disbursed to unauthorised persons by some agency banks against fake Pension Payment Orders (PPOs). Such fraudulent payments are made by pension paying branches without observing prescribed checks such as releasing payments by relying upon calculation sheet not signed by authorised signatory, as also noncompliance with laid down procedures, especially regarding receipt of PPOs by banks. Railway pension paying branches are therefore requested to strictly follow the procedure laid down in “Scheme for Payment of Railway Pension through Public Sector Banks” by the Ministry of Railways (Railway Board) for disbursement of pension to Railway pensioners to avoid fraudulent payments against fake pension payment orders. (b) Overpayment of pension 26. A list of main areas where the banks tend to make overpayments in respect of Railway pensioners received from Financial Adviser & Chief Accounts Officer’s Office, Central Railway, Mumbai is given in Annex 1. Agency banks were requested to circulate the same among their pension paying branches and instruct them to take appropriate action so as to avoid overpayments of Railway pension. (c) Issue of Due and Drawn statement 27. All agency banks may issue suitable instructions to their pension paying branches for issuance of ‘Due and Drawn’ statement in the prescribed form to Railway pensioners, whenever there is a change/revision in their pension, so as to avoid inconvenience to the pensioners. (d) Single Window System 28. The Single Window System (SWS) has been introduced in case of the reimbursement of Railway Pension payments with Bank of Baroda and Allahabad Bank effect from April 1, 2011, with United Bank of India with effect from July 1, 2011, with State Bank of India and Dena Bank with effect from July 1, 2012 and with Bank of Maharashtra and Union Bank of India with effect from August 1, 2012. Railway pension payments made by these banks will be reimbursed by RBI, Central Accounts Section, Nagpur. Payment of Pension to Telecom Pensioners (a) Single Window System 29. Single Window System (SWS) was introduced in the case of reimbursement of Telecom Pension payments with State Bank of India, its Associates and Nationalised Banks with effect from October 1, 2012. Telecom pension payments made by these banks will be reimbursed by RBI, Central Accounts Section, Nagpur. Customer Service 30. All agency banks may issue instructions to their dealing branches to adhere to the recommendations of the Prabhakar Rao Committee relating to pension payments and accordingly also instruct their internal auditors/inspectors to bestow due attention to adherence to the items of work by the branches listed with respect to the checklist (provided in Annex 2) and comment on the quality of customer service in their reports which may be made available to Reserve Bank’s inspecting officers, as and when they visit the branches. 31. Grievances of pensioners are not being addressed properly at the branch level especially after the setting up of Centralised Pension Processing Centres (CPPCs). To provide hassle free service to the pensioners, there should be a forum for regular interaction and settlement of grievances. Accordingly, agency banks should appoint one/two nodal officers at each Region/Zone for monitoring the resolution of grievances of pensioners on regular basis and the GM/CGM concerned should review the position at monthly intervals. 32. At locations outside the CPPCs, there should be designated nodal officers for pension related complaints who should be easily accessible to pensioners and who should hold regular meetings at different locations in their jurisdiction on the lines of Pension Adalat. Each bank should establish toll free dedicated pension line manned by trained persons with access to the database to answer queries, note down and redress complaints. 33. Following several complaints from pensioners alleging inordinate delay in disbursing revised pension and arrears, agency banks were advised as under:
Training 34. In order to create better awareness among staff about pension payment schemes/ rules, banks may include this as an integral part of the training programmes conducted by their training establishments. 35. Regular training session for bank personnel dealing with pension matters may be organised in consultation with concerned Government Department. Main areas where banks tend to make overpayments 1. Continued Payment of Enhanced Family pension (EFP) beyond Cut-Off date: Family pension at Enhanced Rate is payable for 7 years from the date of death or upto the age the pensioner/deceased railway servant would have attained 65/67 years of age had he/she survived whichever is earlier and beyond that date family pension is payable only at Normal Rates. Though this has been clearly mentioned in the PPO, banks fail to notice the same and continue to pay the family pension beyond the cut-off date, resulting in overpayment of pension. 2. Wrong payment of PP (personal pension) beyond 01-01-1996 Personal Pension was being paid as a separate element to some pre'86 retirees to compensate them the loss suffered due to the difference of DA merger. Consequent upon revision of pension w.e.f. 01-01-1996, (after notional fixation of pay as on 01-01-1986 of all Pre'86 retirees, bringing them at par with serving employees as on 01-01-1986) as per Vth PC recommendations, this personal pension (PP) which was being paid as a separate element had to be discontinued w.e.f. 01-01-1996, as per DOP's O.M. No: 45/86/97/P&PW(A)Pt. III of 10- 02-1998 & 26-09-2000. The banks however continue to pay the personal pension as a separate element, resulting in overpayment of pension. 3. Continued Payment of family pension beyond 25 years of age in case of children of the deceased railway servant. While Family pension payable to the spouse shall cease on his/her death or re-marriage, Family pension payable to the children of the deceased railway servant shall cease to be payable on the death or he/she attaining 25 years of age or if he/she starts earning more than Rs.2550/ per month or on marriage whichever date is earlier. Though specific remark about the date of cessation and the date beyond which it is not payable is mentioned in the PPO, banks fail to notice and continue to pay family pension to the children even after he/she attains 25 years. of age or start earning Rs.2550/- per month. 4. Wrong stepping up of Ex-Gratia Payment to minimum family pension. The railway servants and the families of the railway servants who are not covered by Since this is only the Ex-Gratia Payment and not pension, this should not be stepped up to Rs.1275/- (i.e. minimum pension admissible w.e.f. 01-01-1996). But some of the banks have stepped up the same to Rs.1275/- resulting in overpayment. 5. Wrong Payment of fixed medical allowance of RS.100/- per month to EGP beneficiaries. Fixed Medical allowance of Rs.100/- per month, which was introduced w.e.f. 01-12-1997, vide Board's letter No pc-v/98/1/7/1/1/Pt.3 dated 21-04-99, is not payable the EGP beneficiaries (i.e. surviving CSRP retirees / Family of deceased CSRPF optees). Despite clear instructions on the issue FMA is being paid to them, resulting in overpayment. 6. Payment of D.A/Relief paid at higher rate than admissible. The rate of relief admissible to the families of the deceased railway servants who are in receipt of Ex-Gratia Payment of Rs.150/ or RS.605/-, is less than the rate of relief admissible to all other pensioners and the surviving Ex-Gratia Beneficiary. But no such distinction is made and relief admissible to pensioners are being paid to these Ex-Gratia Beneficiaries resulting in overpayment of pension. 7. Wrong Payment of Dearness Pension/Dearness Family Pension: Consequent upon conversion of 50% of relief as Dearness Pay/ Dearness Pension w.e.f. 01-04- 04, banks have to work out 50% of the Basic Pension/Family Pension authorised and show distinctly as Dearness Pension/ Dearness Family Pension and consequent relief is payable on both Basic Pension + Dearness Pension w.e.f. 01-04-04. This Dearness Pension has to be worked out by the banks only in respect of those cases where the date of cessation of service of the retired/deceased railway servant is on or before 01-04-04. Where the date of cessation is on or after 01-04-2004 banks should not work out any Dearness Pension, as the element of Dearness Pay has already been reckoned while authorizing the pension/family pension in post 01-04-2004 cases. It is observed that some of the banks work out Dearness Pension in post 01-04-2004 cases also. 8. Other Miscellaneous reasons This represent the items shown under the head Ex-Gratia by the banks in the Debit Scroll. 9. Non collection of required Certificates Life Certificate, etc. The banks should ensure that Life Certificates are submitted by the pensioners in the month of November each year and stop automatic credit of pension after November till the same is submitted. If Life Certificate is not submitted for more than three years: the pension papers of all the concerned pensioners should be returned to the FA&CAO that issued the PPO through the designated FA&CAO mentioning the reason for return and the period up to which the pension was disbursed. It is however observed that banks are disbursing pension without obtaining the Life Certificate. A copy of Life Certificate is also not endorsed to the designated FA&CAO. The banks should invariably endorse a copy of Life Certificate to the designated FA&CAO every year and take action as above if the Life Certificate is not submitted by the pensioners to avoid overpayment of pension. Similarly, apart from life certificate, bank should also ensure collection of the following certificates to avoid overpayment of pension/family pension. a) In case of Children of deceased pensioner:
b) In case of spouse: Not re-marriage certificate- half yearly. 10. Quoting the correct and Full PPO number: Pension Payment Order Number (PPO) is the key field with which the internal check is conducted by this railway. It is observed that the banks are not quoting full and correct PPO numbers. Banks may be advised to quote the Revised PPO number instead of the old PPO number, wherever the revision authority has been issued. The RBI's inspection party may kindly be advised to pay special attention to all the above aspects and the bank staff may be educated properly and advised to evolve a system by which the overpayments on these accounts may be eliminated/avoided. Check list relating to Pension payments/government
List of circulars consolidated by the Master Circular
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