Govt staff can encash only 50pc of pension money: Muhith
Finance Minister AMA Muhith on Wednesday said the government service holders can encash their pension money by only 50 percent after their retirement, instead of previous 100 percent on their own decision.
Thousands of retired civil servants, who cashed in all of their pensions in the last two years, are facing financial loss and have deprived themselves of
existing service benefits, the Finance Minister said.
The minister made the remark while talking to reporters after a meeting of the cabinet committee on public purchase and economic affairs.
"We have made a new pension provision and will abolish 100 per cent encashment of the pension fund by retired government employees from July 1," Muhith said.
In 1995, the government introduced a new provision that permitted 100 per cent encashment of pension money in one go.
In 2015, over 30,000 government servants went into retirement of which 4,106 enchashed their entire fund.
Responding to a question on launching pension in the private sector, the minister said the government has undertaken a plan to introduce pension facilities in the private sector but it would take time.
According to a circular issued by the Finance Division of the Ministry of Finance, the government employees can encash 50 per cent of their pension money after retirement and the rest of the amount can be drawn in monthly installment.
The pensioners will get a five percent increment on their monthly pension amount from July 1, 2017, the circular said.