The New Delhi government has given a big relief to the pensioners and has changed the way the pension was settled. Under the chairmanship of Prime Minister Narendra Modi, the Cabinet approved the proposal for this effect on Wednesday. This decision of the government will benefit about 5.5 million pensioners both civil and defense and additional burden of more than Rs 5,031 crore on the public exchequer.
Finance Minister Arun Jaitley briefed the Cabinet about the decision. In relation to pension, the changes approved by the Cabinet will be effective from 1 January 2016 because the recommendations of the Seventh Pay Commission were implemented from this date. With this decision, the central government will spend about Rs 1,76,071 crore annually on pension.
In relation to pensioners, the first decision of the cabinet was in relation to those employees who retired before 2016. The government has approved this proposal on the basis of the recommendation of the committee headed by the pension secretary.
Indeed, the cabinet needed a change in the formula for fixing the pension form because it was not practical to calculate the pension through the formula suggested by the seventh pay commission. That's why a committee under the chairmanship of the pension secretary was formed which suggested a new formula.
The Cabinet also approved changes in the manner of determining disability pension in relation to defense pensioners. It is believed that this will have an additional burden of Rs.130 crore per annum on the government.
Estate plan approved
Under the chairmanship of the Prime Minister, the cabinet also approved a new plan for food processing. The full name of the estate plan - Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters. This is the new scheme of the Central Sector. It is expected to cost about Rs 6000 crore.
It is believed that this fund of the estate plan will bring investment of about Rs 31,400 crore in the field of food processing in the country. It is estimated to benefit 20 lakh farmers. It is also expected to provide direct or indirect employment to 5,30,500 people by 2019-20. The Finance Minister said that the estate plan will be an umbrella scheme and existing schemes such as Mega Food Park will all be covered under its purview.
