FD WITHDRAWS KEY OPTION CLAUSE FOR NPS EMPLOYEES TO RECEIVE FAMILY OR INVALID PENSION
Chandigarh, August 2 ; In a significant move to support the families of State Government employees, Punjab Finance Minister Advocate Harpal Singh Cheema announced today that the Finance Department (FD) has withdrawn a key option clause for New Pension Scheme (NPS) employees to receive family or invalid pension. He said that this decision comes after the government recognized the undue hardship caused to the families of employees who died in harness, as most had not formally exercised this option.
Govt Removes Pension Clause to Ease Relief for All NPS Employees
In a press communiqué issued here, Finance Minister Harpal Singh Cheema said that the government had previously extended additional relief in the form of a family or invalid pension to NPS employees who became disabled or died while in service through Finance Department instructions dated October 8, 2021. However, Clause 6 of these instructions required both existing and newly recruited employees to choose within a specific timeframe whether they wanted to receive the family or invalid pension or the benefits of the NPS scheme. He said that this condition had created significant difficulties for families who were unaware of the requirement or were unable to complete the process.
The Finance Minister said that the Finance Department officially deleted Clause 6 of the instructions on June 27, 2025 to rectify this issue. He said that the government has now extended this change—initially implemented for Punjab Government NPS employees—to include NPS employees of Boards, Corporations, Public Sector Undertakings (PSUs), and State Autonomous Bodies (SABs).“This ensures that all employees under the NPS are now eligible for the additional relief without having to formally exercise the option”, he added.
Notably, the Directorate of Public Enterprises and Disinvestment (DPED) implemented the October 8, 2021, instructions for Boards, Corporations, PSUs, and SABs under the Punjab Government through a letter dated January 23, 2024.
The Finance Minister Harpal Singh Cheema said that the Punjab government aims to provide seamless benefits to employees and their families by removing this clause, ensuring that they receive the necessary financial support during difficult times. He said that this decision highlights the Punjab Government’s commitment, led by the Aam Admi Party (AAP), to address employee welfare. It also promotes a supportive work environment.
