9. SCHEME REGARDING PENSION-CUM-PROVIDENT FUND-CUM-INSURANCE
Facilities available for teachers with regard to Pension, Provident Fund, etc., vary from State to State and from Management to Management which may be classified under three categories:
(a) Government
(b) Local Body
(c) Private
(a) Government : Teachers in Government service come under the rules governing Government servants and are eligible for Pension and Provident Fund in accordance with the rules applicable to Government servants.
(b) Local Body : Teachers employed by local bodies are normally not eligible for pension, but to the contributory provident fund to which the subscriber makes a subscription of 6 1/4% of his salary, the local body contributing a like sum. No other benefits are given for teachers.
(c) Private Managements: With regard to private managements the benefits of contributory provident fund are available in some cases. In some States special rules governing provident funds for aided teachers have been framed by which the teacher subscribers 6 1/4% of his salary, the Management and the State contributing together an equal amount.
In one State a system of Pension-cum-Provident Fund-cum-Insurance has recently been introduced. The Commission recommends that a similar system should be introduced for the benefit of teachers in all States. According to this scheme, the employee is entitled to the following benefits :
(a) Contributory Provident Fund: To this an employee can subscribe not less than 6 1/4% of his salary subject to a maximum of about 15%, the State contributing at the rate of nine pies per rupee (three-fourths of an anna) as its share.
(b) Pension : Pension equal to one-fourth of the average emoluments during the last three years of service for approved service not less than 25 years or pro-rata pension for service of more than 15 years and less than 25 years. this is arrived at by multiplying the salary by the number of years and dividing it by 120.
(c) Insurance: An employee shall keep himself insured for a sum which ,should be not less than Rs. 500 and not more than Rs. 5,000 depending on the scale of salary drawn by him.
It would appear from the above that the Government roughly compute the capital value of an employee's pensi on for a sum which would stand to his credit by way of contribution to Provident Fund at the rate of nine pies (three-fourth ,of an anna) per rupee of salary.
The following scheme is therefore suggested:
Every teacher employed permanently in an institution shall be entitled to Pension-cum-Provident Fund-cum-Insurance.
(i) Pension : Pension shall be one-fourth of average emoluments during the last three years of service and the amount of pension that may be granted shall be determined by the length of service.
310 APPENDICES [APP. IX
The amount of pension Shall be regulated as follows :
Years of Completed Scale of Pension
Service
15 15/one hundred and twentieths of average emoluments.
16 16 " " " "
17 17 " " " "
18 18 " " " "
19 19 " " " "
20 20 " " " "
21 21 " " " "
22 22 " " " "
23 23 " " " "
24 24 " " " "
25 and above30 " " " "
For purposes of payment of pension, there shall be established a Pension Fund which shall be administered by Government through the Director of Public Instruction.
Every Management shall subscribe to the Pension Fund Account of every permanent teacher in its employ a sum calculated at the rate of 9 pies per rupee of salary drawn by the teacher. This amount shall be funded up monthly and shall be invested by the Director of Public Instruction and kept as a Pension Fund Account, out of which every teacher who is entitled to the benefit shall be paid the pension due to him on superannuation.
(ii) Provident Fund: Every teacher employed shall subscribe to a contributory Provident Fund.
Every subscriber shall subscribe monthly to the fund an amount not less than 61% (i.e., one-anna in the rupee) of his pay, or leave salary, but not exceeding 12% (i.e., two annas in the rupee) of his pay or leave salary, the amount of subscription being fixed yearly by the subscriber himself.
The subscriber shall intimate the fixation of the amount of his monthly subscription in whole rupees before the end of the preceding year, except during the year when the first elects to come under this scheme.
A teacher may, at his option, not subscribe during leave. He shall intimate his election not to subscribe during the leave by written communication to the head of the institution before he proceeds on leave. The option of a subscriber intimated under this clause shall be final. Failure to make due and timely intimation shall be deemed to constitute an election to subscribe.
This amount shall be subscribed monthly by every subscriber. It shall be the duty of the management to maintain an account of subscription by each teacher under its employ. This amount shall be invested either in Post-Office Savings Bank Account as at present or in National Savings Certificate or in Government Securities as may be decided. The Government shall contribute to the Provident Fund Account of each teacher at the rate of nine pies in the rupee of the actual pay or leave salary drawn by him. The amount of contribution payable by the Government shall be calculated at the end of each year and credited to the subscriber's account or may be calculated on the retirement of the teacher or death or on leaving the service of the incumbent and credit to his account.
The Government contribution and the interest thereon shall be payable in full in the following cases:
(a) If he subscriber retires after completing 15 years service in the institution;
APP.IX] APPENDICES 311
(b) If he retires on account of certified incapacity, or such incapacity having arisen from causes beyond his control; or (c) If his services are terminated as the result of a reduction in the establishment of the institution or abolition of his post; or (d) If he dies.
For a service of more than 10 years but less than 15 years the share of Government contribution and interest payable shall be calculated according to the following table :
On the completion of
10 years' service 10/15ths
11 11/15ths
12 12/15ths
13 13/15ths
14 14/15ths
(iii) Insurance:Every teacher who has been confirmed shall insure his life with Postal Life Insurance or Private Life Insurance Companies or under such group Insurance as may be arranged by each Management for the minimum amounts specified below :
Sum Insured
Rs.
(1) If his pay is less than Rs. 45 500
(2) If his pay is Rs. 45 and above but does not exceed Rs.90 1,000
(3) If his pay exceeds Rs. 90 but does not exceed Rs. 150 2,000
(4) If his pay exceeds Rs. 150 but does not exceed Rs. 250 3,000
(5) If his pay exceeds Rs. 500 5,000
Provided that a person who has already taken out an Insurance Policy or who is restricted for insurance as a bad life or who has completed the age of 40 shall be exempted from his insurance.
Such compulsory insurance shall be taken by a teacher within an year of his coming under these rules; and in the case of a teacher who is promoted from one grade to another, he shall take such additional insurance policy as may be necessary for his higher emoluments within 6 months of such substantive promotion. (For failure to comply with these conditions, he shall be liable to disciplinary action.)
A policy taken under these rules may be assigned to any member of the subscriber's family but not to any one else as a gift or for value received. Such a policy shall not also be mortgaged.
The policy taken under these rules shall be Whole Life Policy with limited payments or an Endowment Policy for limited period provided that the amount of insurance is payable only on or after the date of his attaining superannuation or at his death, whichever is earlier.
The policy shall not be allowed to lapse or forfeiture by non- payment of any premium due and the policy shall be kept alive and evidence of its being kept alive and unencumbered shall be produced before the head of the institution.
In the event of the Management arranging the scheme of Group Insurance, the premium due to the company or companies under such scheme from the members of the Fund on their policies shall be deducted from their monthly salaries and remitted to the Insurance Company or Companies.
312 APPENDICES [APP. IX