I am here sharing today the Legal aspects of the 2001 Payscales-cum-Pension Scheme for the employees and pensioners. The main points are as under:

Legal Aspects of 2001 Payscales-cum-Pension Scheme

1. A scheme, namely “Basic Pay Scales, Allowances and Pensions, 2001” was introduced by Finance Division through Office Memo No. F. 1(5) Imp/2001 dated 4^th Sep 2001. This scheme was also adopted by all provincial governments on different dates.  It is intended to explain here in detail (a) who are the government servants/pensioners covered by the Scheme, and (b) to point out those government servants/pensioners to whom the Scheme is NOT applicable.

2. The scheme consists of 3 specific parts comprising paragraphs 2 to 16, followed by 4 paragraphs on option, modification, and anomalies, as under:

            Part I   Basic Pay Scales and allied matters               [paragraphs 2 to 10],

            Part II  Allowances                                                     [paragraphs 11 to 15],

            And Part III Pension                                                           [paragraphs 16 (a) to (g)]

            Options, modifications and anomalies                        [paragraph 17 to 20].

3. Paragraph 17 (a) of the Scheme required all existing (on date of issuance of the scheme) civil employees to exercise an option in writing:

(i) to draw pay either in the Revised Basic Pay Scales and Pension / Commutation scheme 2001,

                                                           OR

(ii) to draw salary in the (then) existing Basic Scales of Pay of 1994 [and pension/commutation scheme as per then existing formulae].

4. Paragraph 17 (b) of the Scheme specifies that an existing employee who did not exercise the requisite option was deemed to have opted to continue to draw salary in “basic pay scales of 1994 and pension/commutation as per existing formulae”.

5. The option was also given under para 18 of the Scheme to pensioners retiring from 1 July 2001 onward for adopting the Revised Basic Pay Scales 2001 and Pension / Commutation scheme 2001 under certain conditions.

6. To sum up, the 2001-Scheme was/is applicable only to:-

• Employees existing on 4.9.2001 and opting for it under para17 (a)
• Pensioners from 1.7.2001 onward opting for it under para 18.

7. The 2001-Scheme is not applicable to other employees or pensioners, i.e, to:

• Employees existing on 4 Sep 2001 who:

• opted in writing under para 17 (a) of the Scheme to continue to be governed by the “basic pay scales of 1994 and pension/commutation as per existing formulae”.

• did not exercise any option and were deemed to have opted to continue to draw salary in “basic pay scales of 1994 and pension/commutation as per existing formulae”.

• Pensioners who

• retired from 1 July 2001 onward and did not exercise the option available under para 18 of the Scheme, and

(ii)  retired before 1 July 2001 and were not required to give any option.

8. Accountant General / District Accounts offices did not appreciate the true spirit of para 16 (e) of the Scheme which says that “In future, the increase in pension to the pensioners shall be allowed on net pension instead of a gross pension.” This provision is obviously applicable to employees/pensioners mentioned in sub paras (i) and (ii) of Para 7 (a) above only [and not to those mentioned in sub paras (i) and (ii) of Para 7 (b) above].

9. Section 3 (2) of the Civil Servants Act 1973 [reproduced below] provides that terms and conditions of a civil servant shall not be varied to his disadvantage. By enforcing para16 (e) of the Scheme on pensioners having retired before 1 July 2001, the Accountant General / District Accounts offices contravened this statutory provision and caused significant financial loss and mental anxiety due to a decrease in the pension amount.

3. Terms and conditions.- (2) The terms and conditions of service of any person to whom this Act applies shall not be varied to his disadvantage.

10. Many a pensioner who had retired before 1 July 2001 [but increases in their cases were given on Net Pension (instead of on Gross Pension) from 2001 onward], took up litigation against government agencies. They have by and large succeeded in getting the desired relief from Federal Service Tribunal and High Court.  Supreme Court also upheld those cases.

11. Last, but not least, a reference may be invited to Supreme Court directions appearing on page 4 of Supreme Court Monthly Review Vol XLII 2009 orders a copy of which is attached at B1 to B4 also. Emphasis on the extract below:

It was  held  by  this   Court in case of Hameed Akhtar Niazi v.  The Secretary  Establishment Division Government of Pakistan and others 1996 SCMR 1185, that if a Tribunal or this Court decides a point of law relating to the terms and conditions of a civil servant who litigated,  and there were other civil servants, who may not have taken any legal proceedings, in such a case, the dictates of justice and rule of good governance demand that the benefit of the said decision be extended to other civil servants also,  who may not be parties to the litigation instead of compelling them to approach the Tribunal or any other legal forum

12. In order to resolve the matter amicably, and to avoid further wastage of time, efforts, and money of government agencies and pensioners, it would be in the fitness of things if Law Division / Departments issue their recommendations in the matter after considering all legal aspects of the matter.

13. Friends are welcome to comment, especially with reference to the law involved in the above matter.

Special thanks for Legal Aspects of 2001 Payscales-cum-Pension Scheme information for:

Agha Amir Ahmad

0300 9800246

[email protected]

Supreme Court Monthly Review

The matter has already been decided by this  Court in the case of   Mst. Naseem Akhtar (supra),  and it has been held that the appointment orders of the respondents as PTC Teachers were genuine.  It was held by this   Court in case of  Hameed  Akhtar  Niazi  v.  The  Secretary     Establishment   Division Government of  Pakistan and others  1996 SCMR 1185,  that if a Tribunal or this Court decides a point of law relating to the terms and conditions of a civil servant who litigated,  and there were other civil servants, who may not have taken any legal proceedings,   in such a  case, the dictates of justice and rule of good governance demand that the benefit of the said decision is extended to other civil servants also,    who may not  be parties to the litigation instead of  compelling  them  to  approach  the  Tribunal  or  any other legal forum.

This view was reiterated by this Court in the case of Tara Chand and  others v.  Karachi  Water  and  Sewerage  Board, Karachi and others 2005 SCMR   499    and it was held that   according to Article 25 of the Constitution of Islamic Republic of Pakistan,, 1973 all citizens are equal before the law and entitled to equal protection of law.

6. In this view of the matter, we are of the view that no ground for interference in the impugned judgment is made out.  Accordingly, the petitions being devoid of force are dismissed and leave to appeal refused.

M.B.A./G-13/SC                                                            Petitions dismissed