Retirement age Hike: Retirement age of these government employees can be from 58 to 59 years, check details

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The Sukhu government of Himachal Pradesh, which is trying to overcome the deepening financial crisis, is now preparing to increase the retirement age of government employees from the current 58 years to 59 years.

This is being seriously considered. The final decision on this proposal will be taken in the cabinet meeting to be held tomorrow, Monday, May 5, under the chairmanship of Chief Minister Sukhvinder Singh Sukhu . The Finance Department will make a detailed presentation on this proposal in the cabinet.

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In fact, due to a huge cut in the revenue deficit grant received from the central government in the financial year 2024-25, the financial pressure on the state government has increased. Last year, this grant was Rs 6258 crore. Whereas this year it has come down to only Rs 3725 crore. In such a situation, the government wants to reduce the immediate financial burden by increasing the retirement age. If this proposal is implemented, then the government can get relief from lump sum pension payment (commutation) to the employees retiring this year and there can be financial savings of about Rs 2000 to 3000 crore.

Earlier, during the tenure of the Virbhadra Singh government of Congress, the employees were given the option of one year of additional service between 2013 and 2015. At that time also, the state had to face a serious financial crisis in the last years of the 13th Finance Commission. Now when the amount received from the 15th Finance Commission is being reduced and the recommendations of the 16th Finance Commission will be implemented from 2026, the government is feeling the need for an immediate solution in this gap of two years.

The Finance Department believes that increasing the retirement age of employees by one year will not only provide immediate financial relief but will also give the government an opportunity to stop new recruitments. This will also reduce the burden of salaries and allowances. The sub-committee headed by Deputy Chief Minister Mukesh Agnihotri on ‘Resource Mobilization’ has also recommended to the government that the retirement age should be made 59 years.

Two other important proposals are also likely to be discussed in the cabinet meeting. The first proposal is related to stopping the advance pension i.e. ‘commutation’ given to employees at the time of retirement. Currently, employees can take a part of their pension as a lump sum amount. This puts a huge financial pressure on the government. The government is considering limiting or partially stopping this facility. However, Chief Minister Sukhu has indicated that the facility of commutation can be retained for employees who are retiring soon.

The second major proposal is to increase the minimum service period for full pension from 20 years to 25 years. At present, full pension is available after 20 years of service in the state. But now there is a proposal to amend it on the basis of Punjab model. This can help the government to control pension expenditure in the long term. However, there is some confusion among the employees regarding this proposal. One section believes that increasing the retirement age will benefit the services of experienced employees, while the other side believes that this may limit employment opportunities for the youth.

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