The Center has clarified the General Provident Fund (GPF) disbursement to government employees on retirement. This clarification, provided by the Department of Pension and Pensioners’ Welfare (DoPPW), addresses questions about interest payments on deferred GPF payments after retirement.
The new instructions, dated October 25, 2024, emphasize the importance of timely processing at every stage, from preparing pension lists to issuing the Pension Payment Order (PPO). In addition, this notice clarifies the payment of interest on delayed General Provident Fund (GPF) final payments for retired government officials, addressing the responsibilities of the relevant authorities and the consequences of any delays in disbursement.
“Recently, some references have been received regarding interest on deferred payment of GPF to the retired government to clarify whether interest is payable on GPF post-retirement,” the memorandum said.
Center provides clarification on payment of GPF to retired employees: key points
1)Rule 34 of the General Provident Fund (Central Service) Rules, 1960 provides that the Accounts Officer shall ensure timely payment of the GPF amount on retirement of the subscriber.
2) The GPF amount is the sole asset of the individual government official, and any pending disciplinary action will not affect its disbursement.
3) Interest on deferred payments: As per Rule 11(4), if the GPF balance is not paid at retirement, interest is payable for the post-retirement period.
4)Interest payment procedures:
- The Wage and Accounts Office (PAO) can approve interest up to six months after retirement.
- Interest payments beyond six months require approval from the Head of the Accounts Office, and the Comptroller of Accounts/Financial Advisor must approve payments after one year.
- Escalation of delays: All cases where interest payment is required will be submitted to the Secretary of the relevant administrative ministry or department to avoid financial burden resulting from interest on delayed GPF payments.
- Responsibility assignment: The Secretary will determine responsibility for delays in GPF payments at all levels to ensure timely processing and avoid unnecessary interest payments.
Read all our personal financial stories here
