scorecardresearch

7th Pay Commission: Big change in payment of ex-gratia lump sum compensation rule announced; check details

Payment of ex-gratia compensation rules: If no nomination has been made or the nomination made by the Government servant does not subsist, the ex-gratia lump sum compensation will be shared equally by all eligible family members

7th Pay Commission: Big change in payment of ex-gratia lump sum compensation rule announced; check details
Representative image

The Central Government has modified the rules for payment of ex-gratia lump sum compensation to family of Central Government Employees who die in performance of official duty. The families of Central Civil Government servants, who die before retirement in the performance of their bonafide official duties under various circumstances, are entitled to payment of ex-gratia lump sum compensation. This amount has been revised from time to time.

Now, the Finance Ministry has decided that the payment of the ex-gratia lump sum compensation will be made to a member, or members of the family, in whose favour nomination is made by the Government servant during service.

“On death of a Government servant, payment of other lump sum amounts, such as death gratuity, GPF balance and CGEGIS amount, is made in accordance with the nominations made by the Government servant during service. Accordingly, it has been decided that, on death of a Government servant in the performance of bona fide duty also, payment of ex-gratia lump sum compensation may be made to a member or members of the family in whose favour a nomination is made by the Government servant during service,” the Department of Pension and Pensioners Welfare (DoPPW) said in an Office Memorandum(O.M.) dated 30th September 2021.

The Government has also amended the Common Nomination Form in Form 1 appended to the CCS (Pension) Rules, 1972 to include the nomination in respect of the ex-gratia lump sum payment.

What if no nomination is made

The DoPPW said that if no nomination has been made or the nomination made by the Government servant does not subsist, the ex-gratia lump sum compensation will be shared equally by all eligible family members, as in the case of Gratuity, in accordance with Rule 51 of the CCS (Pension) Rules.

Nomination outside family not allowed

The DoPPW also said that no nomination can be made in favour of a person who is not a member of the family, even where the Government servant has no family.

“The nomination for ex-gratia lump sum payment shall be subject to the provisions as applicable in the case of gratuity under Rule 53 of the CCS (Pension) Rules, 1972. Since the ex-gratia lump sum payment is payable to the family only, no nomination shall be made in favour of a person who is not a member of the family, even where the Government servant has no family,” the O.M. said.

Why new rule

After the death of a Government servant, payment of other lump sum amounts, such as death gratuity, GPF balance and CGEGIS amount, is made in accordance with the nominations made by the Government servant during service.

However, the existing rules did not specify the member of the family to whom such exgratia lump sum compensation is payable. Hence, till now this payment has been made to the member of the family who is eligible for extraordinary family pension under the CCS (Extraordinary Pension) Rules, 1939.

The salary to Central Government Employees is paid in accordance with the 7th Pay Commission recommendations.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.