Raise the minimum pension to 60% of the Minimum wage i.e. Rs. 10800/-pm.

Minimum Pension is presently computed as half of the minimum wage determined by the Pay Commissions.   One is entitled for full pension on completion of the specified number of years of service. Pension is computed as 50% of the last pay drawn.  It is, therefore, discernible that the computation of Minimum pension at 50% had been based on the assumption that pension is normally calculated as half of the last pay drawn. This appears to be not based on any sound principle. 

 Minimum pension is related to Minimum wage. Minimum wage  is the wage determined on the basis of the minimum basic and essential  requirement of a person’s existence. As per the agreed formulations as early as in 1957, the basic essential requirement is considered to be the requirement of the family of a person.  Family is defined as “Husband, wife and two children” treating this as three units.  The formula stipulates and provides one unit for the bread earner, 0.8 units to his spouse and 0.6 unit for each children.   The point at issue is that the minimum pension cannot be less than the minimum wage.

   Minimum wage being the least below which a person may not be able to live on, the same analogy must apply to the pensioner. Minimum pension is the need based requirement  of a pensioner, whose family includes his spouse who  is fully depended upon his pension income.    However, taking into account the fact that the superannuation age of retirement being 60, no pensioner in the normal circumstances may  have dependent children. 

 The logical conclusion that emerges is that the minimum pension must not be less than 60% because the family of the pensioner shall have 1.8 units  which is just 60% of the family units of a working employee.  We  request therefore, that the concerned may be advised to determine the minimum pension at 60% of the minimum wage, which will work out to Rs. 10,800/- p.m.