Centre Approves Wage and Pension Revisions for Insurance, NABARD and RBI Employees

The revision provides an overall increase of 12.41% in the wage bill, including a 14% hike in existing Basic Pay and Dearness Allowance.

 

The Central Government has approved a series of wage and pension revisions aimed at boosting employee morale and strengthening social security for pensioners across key financial institutions, including Public Sector General Insurance Companies (PSGICs), the National Bank for Agriculture and Rural Development (NABARD) and the Reserve Bank of India (RBI).

The decisions underscore the Government’s continued commitment to recognising long and dedicated service in the financial sector, while ensuring fair compensation and dignified post-retirement security for employees and their families.

Wage and Pension Revisions for PSGIC Employees

The Government has approved a wage revision for employees of PSGICs, effective from 1 August 2022. The revision provides an overall increase of 12.41% in the wage bill, including a 14% hike in existing Basic Pay and Dearness Allowance.

A total of 43,247 PSGIC employees will benefit from the revised pay structure. The revision also enhances the National Pension System (NPS) contribution from 10% to 14% for employees who joined after 1 April 2010, strengthening long-term retirement security.

Family Pension Revision

Family pension for PSGIC retirees has been revised to a uniform rate of 30%, effective from the date of publication in the official gazette. This measure will benefit 14,615 family pensioners out of a total of 15,582, recognising their contribution to the organisations.

Financial Implications

The total financial outgo for PSGIC-related revisions amounts to ₹8,170.30 crore, comprising:

• ₹5,822.68 crore towards wage revision arrears,

• ₹250.15 crore towards enhanced NPS contributions, and

• ₹2,097.47 crore towards family pension payments.

The PSGICs covered under the revision include:

• National Insurance Company Ltd. (NICL)

• New India Assurance Company Ltd. (NIACL)

• Oriental Insurance Company Ltd. (OICL)

• United India Insurance Company Ltd. (UIICL)

• General Insurance Corporation of India (GIC)

• Agricultural Insurance Company Ltd. (AICIL)

Pay and Pension Revisions for NABARD

For NABARD, the Government has approved a pay revision effective from 1 November 2022, providing an average increase of around 20% in pay and allowances for all Group A, B and C employees. The revision will benefit approximately 3,800 serving and former employees.

Pension Revision

Basic pension and family pension for NABARD retirees who were originally recruited by NABARD and retired before 1 November 2017 have now been brought on par with ex-RBI NABARD retirees, addressing long-standing parity concerns.

Financial Implications

• Pay revision will result in an additional annual wage bill of around ₹170 crore, with arrears amounting to approximately ₹510 crore.

• Pension revision will involve a one-time arrear payment of ₹50.82 crore, along with an additional monthly outgo of ₹3.55 crore, benefiting 269 pensioners and 457 family pensioners.

Pension Revision for RBI Retirees

The Government has also approved the revision of pension and family pension for retirees of the Reserve Bank of India (RBI), in line with its commitment to ensuring fair and sustainable retirement benefits.

Under the revised framework:

• Pension and family pension will be enhanced by 10% on basic pension plus dearness relief, effective from 1 November 2022.

• This results in an effective enhancement of basic pension by a factor of 1.43, significantly improving monthly pension payouts.

The revision will benefit 30,769 beneficiaries, including 22,580 pensioners and 8,189 family pensioners.

Financial Implications

The total financial impact of the RBI pension revision is estimated at ₹2,696.82 crore, comprising:

• ₹2,485.02 crore as one-time arrears, and

• ₹211.80 crore as recurring annual expenditure.

Broad-Based Impact Across the Financial Sector

Overall, the approved measures will benefit approximately:

• 46,322 serving employees,

• 23,570 pensioners, and

• 23,260 family pensioners.

The Government said these revisions will provide meaningful relief by helping beneficiaries better absorb rising living costs, while maintaining dignity, financial security and social standing post-retirement.

Officials reaffirmed that the Government remains committed to strengthening institutions that play a pivotal role in India’s inclusive and sustainable economic growth, while ensuring fairness and social security for those who serve them.