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POWERGRID Employees Defined Contribution Superannuation Benefit (Pension) Scheme & Post Retirement Medical Benefit Scheme. POWERGRID Pension Scheme. Post Retirement Medical Benefit Scheme. POWERGRID Employees Defined Contribution Superannuation Benefit (Pension) Scheme. Background.
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POWERGRID Employees Defined Contribution Superannuation Benefit (Pension) Scheme & Post Retirement Medical Benefit Scheme
POWERGRID Pension Scheme Post Retirement Medical Benefit Scheme
POWERGRID Employees Defined Contribution Superannuation Benefit (Pension) Scheme
Background “POWERGRID Self Contributory Supperannuation Benefit (Pension) Scheme” (A Defined benefit scheme) was in operation w.e.f. 01.04.1995. Restructured from ‘Defined Benefit’ to ‘Defined Contribution’ w.e.f. 01.10.2004. Modified w.e.f. 01.01.2007 as “POWERGRID Employees Defined Contribution Supperannuation Benefit (Pension) Scheme”
Contributions Members Contribution: 3% of Basic Pay (including stagnation increments) plus Dearness Allowance. A member may also contribute any additional amount as voluntary contribution to the superannuation fund. Corporation’s Contribution: Contribution made by the Corporation within a ceiling of 30% of employee’s salary after discounting for PF, Gratuity, PRMB (Post Retirement Medical Benefit) and any other retirement benefit, to the Superannuation Fund
ADMINISTRATION OF THE SCHEME The number of Trustees shall be 11 (Eleven) including the Chairman - 5 Nominees of the Management - 4 Nominees of Workmen - 1 Nominee from the Supervisory Category - 1 Nominee from the Executive Category
Benefits In case of superannuation: Employee who superannuates from the company and has completed 15 years of service in POWERGRID (including services in other CPSE). The total accumulated amount to the credit of the employee will be used for purchase of pension annuity from approved pension provider. Employee can commute upto1/3rd of their cost of annuity.
Benefits (Contd…) In case of Death / Total Permanent Disablement: The total accumulated amount to the credit of the employee will be used for purchase of pension annuity, irrespective of the eligibility criteria of completion of 15 years and payment of commutation as per rules.
Benefits (Contd…) In case of Resignation : (i) Resigns from service and joins another CPSE where similar scheme exists: The entire amount of corporation’s contribution and member’s contribution along with interest accrued thereon shall be transferred to such CPSE, provided the CPSE agrees to accept the fund transfer and the request for transfer through proper channel.
Benefits (Contd…) (ii) Resigns from service & joins another CPSE where similar scheme does not exist or joins any organization which is not a CPSE The member will get the accumulated amount available in his/her account under the head “Member’s Contribution” only along with accrued interest as on the date of his resignation. The “Corporation’s contribution” from 01.01.2007 on the member’s account will be transferred to the “Forfeiture account” (being maintained in POWERGRID) which will be adjusted in the subsequent corporation’s contribution
General Joining from other CPSE Employees joining POWERGRID from other CPSE having similar pension scheme shall have the option of transferring their corpus to POWERGRID’s Pension fund.
General EMPLOYEES ON DEPUTATION The employee shall make the contribution as per the notified percentage of his salary laid down from time to time along with additional amount if any, to the fund and employer’s contribution will be made by the borrowing organization (or alternatively by the employee himself).
General EMPLOYEE KEEPING LIEN ON THE SERVICE OF POWERGRID POWERGRID Executives and Functional Directors appointed to senior and top level posts through Govt. order or presidential order in other PSU/Govt. Deptt./Authority/Board keeping lien on the fund, may be permitted to continue as the member of the scheme provided that the laid down contributions in respect of such Executive/Functional Director is contributed to the fund.
Accounts Each member has an individual pension account and an unique pension Account Number. The amount contributed by each employee is credited to the existing individual pension account under the head “Member’s contribution” The contribution made by the Corporation is credited to the existing individual pension account under the head “Corporation’s contribution”.
Pension Payments on DC principle The benefit under this scheme will be the total accumulated amount on account of employees contribution and Corporation’s contribution only Pension annuity will be purchased out of the accumulated amount in the individual pension account. Quantum of pension will be determined based on prevailing rate of annuity.
Commencement and Eligibility: Commencement: The Policy was adopted in POWERGRID since its inception. Eligibility: • Employee who superannuate from the company or separated on medical ground • Completed minimum period of 10 years of continuous service in Central Govt./State Govt./PSU. • Minimum 3 years of service in POWERGRID
Eligibility (Contd….) • Board level appointees, on completion of their tenure or on separation on medical ground • POWERGRID Executives and Functional Directors, appointed to senior posts in other PSU/Govt. Dept/Authority/Board/ etc. through Govt./ Presidential orders on their retirement or on attainment of age of superannuation or on completion of tenure of appointment or on separation on medical ground. • Provided they exercise their option for coverage under the POWERGRID Scheme.
Coverage & Benefits Coverage: Employee and Spouse Benefits: • Indoor treatment: Reimbursement of medical expenses incurred on indoor treatment (ii)Outdoor treatment: As in case of regular employees, subject to annual ceiling of maximum of pay scale of a serving employee of equivalent status/rank
Contribution: One time contribution as follows: Executives : ₹ 7200/- Supervisor : ₹ 6000/- Workmen : ₹ 5000/-
Amount disbursed in previous years Post Retirement Medical Benefit : Given below
Gratuity liability due to change in ceiling from 3.5 to 10 lakhs should not be part of 30% of superannuation benefit, the reasons are : • Gratuity as per revised ceiling is for the period of service rendered for earlier years • 30% superannuation benefit is calculated on the revised pay w.e.f 01-01-2007 and accrual of gratuity is 15 days for each completed year of service so the gratuity contribution should not exceed in any case for 15 days of salary for each year
If an employee retired on 31-Jan-2007 , he will get the Gratuity of 10 Lakhs by contributing a small amount whereas other employee who is retiring on 31-03-2011 has to borne a huge amount to get Rs.10 lakhs of Gratuity (Not at par with the employee retired on 31-Jan-2007) • The employee who joins the company in Jan 2007 has to borne the burden of gratuity liability for the period which is not pertaining to him • How an employee can contribute beyond the limit of 30% of salary on account of single head i.e. Gratuity only (Due to increase in ceiling) and which is also not sufficient to meet the liability of Gratuity in a single year.
Forfeiture Account The account heading of the account (to be maintained in POWERGRID) in which such amount of Corporation’s contribution from 01.01.2007 on the member’s account will be transferred to: If the employee resigns from the company joins another CPSE not having a similar pension fund or any organization not being a CPSE. In case of Dismissal / removal from service of the corporation and/or otherwise lost his lien on his employment