The Department of Pension and Pensioners Welfare (DoPPW) issued new instructions on October 25, 2024, due to frequent inquiries regarding interest payment on delayed GPF disbursement after retirement. These instructions emphasize the need for timely handling at every stage from preparation of retirement list to issuance of Pension Payment Order (PPO).

The notice also gives details of payment of interest on delayed GPF final payments for retired government employees. It also mentions the duties of the concerned officials and the consequences of delay in disbursement. The important points of the Central Government’s clarification on GPF disbursement to retired employees are as follows…

1. Timely payment: Rule 34 of the General Provident Fund (Central Services) Rules, 1960 mandates that the accounts officer should ensure that the GPF amount is paid promptly on the retirement of the subscriber.

2. Unconditional disbursement: The GPF balance is the property of the retired government employee and its disbursement is unaffected by any pending disciplinary proceedings.

3. Interest on delayed payments: Rule 11(4) states that if the GPF balance is not paid at the time of retirement, interest should be charged for the period beyond the retirement date.

4. Interest Payment Approval Process: The Pay and Accounts Office (PAO) can approve interest for a delay of up to 6 months after retirement. In case of delay beyond six months, approval from the Head of the Accounts Office is required for interest payment. In case of delay beyond one year, authorization from the Controller of Accounts/Financial Advisor is required for interest payment.

5. Extension of Delay: Cases involving interest payment will be referred to the Secretary of the concerned administrative Ministry or Department to prevent additional financial burden due to delay in GPF payment.

The Secretary will assign responsibility at each stage of the GPF payment process to prevent delays, avoid unnecessary interest payments and ensure timely disbursement.

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Issuing the order by DoPT, it has been said that a number of representations have been invited regarding the GPA payment of S officers retiring on central deputation. As per the present rule, members retiring from service submit their applications to the account officers of the respective state and the process of final payment of GPF to them is completed through the state government.

The same provision is laid down inter alia in Rule 31(3)2 of AIS Rules 1955. Under which the customer submits an application to the Accounts Officer through the office or department head for payment of the amount. Important amendments and changes are being made in these processes, which will be mandatory to take care of.

Change in rules

Under this, officers can submit applications through the Withdrawal and Constituent Officer of the department to the Accounts Officer of the concerned state, where the AIS officer is posted on central deputation. Along with this, it was clarified in the order that it will be the responsibility of the head of the office to issue approval by the accounting officer of the concerned state.

Under other rules the sanction authority issued by the Accounts Officer of the State shall be addressed to the Pay and Accounts Officer of the Ministry Department of the Central Government. Further instructions have been given that the sanction and authorization should inter alia include that “payment can be made by the PAO recipient and reimbursement claim can be made from the AG of the State Government.

Further, in respect of a State where the GPF of AIS officers is being made by the AG Officer. Before issuing the sanction letter to the sanctioning authority of the State Government, it will be mandatory for the State Government to obtain certificates from the ASG regarding the balance in the GPF account of the concerned PAO officers.

Same in respect of such State where GPF account is not being maintained by the Fire Officer. It will be mandatory for the approving authority in the State Government to confirm the balance in the GPF account of the subscriber from the concerned authority maintaining the GPF account.

Along with this, on receipt of authorization/approval from the concerned Accountant General of the State Government and submission of bill by the DDO, the concerned PAO Account Head – MH 8658 Suspense Account (Clivil) – 101- PAO Suspense (adjusted by the concerned AG) will be debited. While doing this, he will receive payment from the government account.

Subsequently, the amount withdrawn will be adjusted through making an external claim against the respective public account of the concerned State. Also where GPF accounts are maintained by the AG office, reimbursement can be claimed from the State Government through the AG office as per the procedure.

On payment, the concerned PAO should send the complete set of documents related to the payment made by him (i.e. voucher, sanction letter, final payment application etc.) to the AG office while claiming reimbursement.

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