Posts Tagged ‘NPS’

Approximately 18 lakh central government employees covered under NPS would be benefitted from the streamlining of the National Pension System

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Ministry of Finance

Streamlining of National Pension System (NPS)

Posted On: 10 DEC 2018 3:01PM by PIB Delhi

Decision

The Union Cabinet in its Meeting on 6th December, 2018 has approved the following proposal for streamlining the National Pension System (NPS).

  • Enhancement of the mandatory contribution by the Central Government for its employees covered under NPS Tier-I from the existing 10% to 14%.
  • Providing freedom of choice for selection of Pension Funds and pattern of investment to central government employees.
  • Payment of compensation for non-deposit or delayed deposit of NPS contributions during 2004-2012.
  • Tax exemption limit for lump sum withdrawal on exit has been enhanced to 60%. With this, the entire withdrawal will now be exempt from income tax. (At present, 40% of the total accumulated corpus utilized for purchase of annuity is already tax exempted. Out of 60% of the accumulated corpus withdrawn by the NPS subscriber at the time of retirement, 40% is tax exempt and balance 20% is taxable.)
  • Contribution by the Government employees under Tier-II of NPS will now be covered under Section 80 C for deduction up to Rs. 1.50 lakh for the purpose of income tax at par with the other schemes such as General Provident Fund, Contributory Provident Fund, Employees Provident Fund and Public Provident Fund provided that there is a lock-in period of 3 years.

Background

The new entrants to the central government service on or after 01.01.2004 are covered under the National Pension System (NPS). The Seventh Pay Commission (7th CPC), during its deliberations, examined certain concerns regarding NPS and made recommendations in the year 2015. The 7th CPC recommended for setting up of a Committee of Secretaries in this regard. Accordingly, a Committee of Secretaries was constituted by the Government to suggest measures for streamlining the implementation of NPS in the year 2016. The Committee submitted its report in the year 2018. Accordingly, based on the recommendations of the Committee, draft Cabinet Note was placed before the Cabinet for its approval.

Implementation strategy and targets

The proposed changes to NPS would be made applicable immediately once time critical decisions are taken in consultation with the other concerned Ministries / Departments.

Major impact

  • Increase in the eventual accumulated corpus of all central government employees covered under NPS.
  • Greater pension payouts after retirement without any additional burden on the employee.
  • Freedom of choice for selection of Pension Funds and investment pattern to central government employees.
  • Benefit to approximately 18 lakh central government employees covered under NPS.
  • Augmenting old-age security in a time of rising life expectancy.
  • By making NPS more attractive, government will be facilitated in attracting and retaining the best talent.

Expenditure involved

The impact on the exchequer on this account is estimated to be to the tune of around Rs. 2840 crores for the financial year 2019-20, and will be in the nature of a recurring expenditure. The financial implications on account of provisions regarding payment of compensation for non-deposit or delayed deposit of NPS contributions during 2004-2012, would be in addition to the amount indicated above.

No. of beneficiaries

Approximately 18 lakh central government employees covered under NPS would be benefitted from the streamlining of the National Pension System.

States/districts covered

Pan India.

Details and progress of scheme if already running

Presently, the new entrants to the central government service on or after 01.01.2004 are covered under the NPS. NPS is being implemented and regulated by Pension Fund Regulatory and Development Authority in the country.

PIB

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New Pension Scheme Demand To Scrap it: NPS to OPS

NPS to OPS: New Pension Scheme Demand To Scrap it

New Pension Scheme Demand To Scrap it

New-Pension-Scheme-Scrap-NPS-OPSNEW PENSION SCHEME (NPS): The New Pension Scheme is made compulsory for Government employees was brought into effect 2004, this has effected them a lot, lot of agitations are being carried out on scrapping the New Pension Scheme, this agitations has forced many State Governments such as Karnataka, Kerala, Andhra Pradesh, Delhi State Governments to reconsider this New Pension Scheme and formed an expert committee to review this New Pension Scheme. This New Pension Scheme was not implemented by West Bengal State Government. In this angle an analysis is made all about New Pension Scheme and ways to scarp or modify the New Pension Scheme to benefit the Government employees at large is suggested.

Need for Pension : The Pension System thus started in India was finalized by the Indian Pension Act of 1871. It appears that the British Government had the conception of providing its pensioners increase in their pensions to neutralize the effect of inflation.

Pension is a reward for past service. It is undoubtedly a condition of service but not an incentive to attract new entrants, the Pension is paid for past satisfactory service rendered, and to avoid destitution in old age as well as a social welfare or socio-economic justice measure, the fact that the cost of living has shot up and correspondingly the possibility of savings has gone down and consequently the drop in wages on retirement.

That pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer and that it creates a vested right subject to 1972 rules which are statutory in character because they are enacted in exercise of powers conferred by the proviso to Art. 309 and clause (5) of Art. 148 of the Constitution; (ii) that the pension is not an ex-gratia payment but it is a payment for the past service rendered; and (iii) it is a social welfare measure rendering socio-economic justice to those who in the hey-day of their life ceaselessly toiled for the employer on an assurance that in their old age they would not be left in lurch.

As on 01-01-2018 there were 51.96 lakh pensioners in the country, including from Central Civil Services, Railways, and Post, Defence and Defence civilians.

EVOLUTION OF NEW PENSION SCHEME (NPS) IN INDIA:

In 1991 Government of India as introduced diverse economic reforms to pull the country out of economic crisis and to accelerate the rate of growth. These reforms are often described as the New economic policy (NEP) or policy of LPG where L for liberalisation; P for privatisation; G for globalisation. The Congress Government under the Prime Ministership of Hon’ble Prime Minister Shri P. V. Narasimha Rao, the signed an agreement with the International Monetary Fund (IMF) to get the IMF loan in which the IMF had imposed various conditions to get the soft loan which includes pension reforms , which the Indian Government Congress Government had accepted it to reform in a 10 years period .

On the basis of the decision taken in the Eleventh Conference of State Finance Secretaries held in the Reserve Bank of India (RBI) during January 2003, a Group was constituted by the RBI in February 2003 to study the pension liabilities of the State Governments and make suitable recommendations.

The “Pension Fund” to be created under the proposed revised schemes should be kept completely outside the States’ Consolidated Fund and the Public Account
The pension systems, both for Civil Servants and other citizens, as evolved over the years have begun to show signs of financial stress in many countries, including India. Since the pension benefits of Government employees are usually paid from the general revenue of the Governments, the steep rise in such liabilities adversely affect the fiscal soundness of the Government entities. In India too, the increasing pension liabilities of the Central and State Governments have emerged as a major area of concern, especially in the wake of fiscal deterioration in recent years. About 20% of the state Government funds are spent on pension.

During the Hon’ble Prime Minister Shri Atal Bihari Vajpayee of NDA was in power from 1998 to 2004 which implemented this agreement of IMF on pension reforms . The NDA Government constituted two committees namely B.K.Bhattacharya committee headed by Shri B.K.Bhattacharya, Former Chief Secretary, Government of Karnataka as chairman and under the Chairmanship of Shri Biju Patnaik, Chief Minister of Orissa , both these committees recommended introduction of New Pension Scheme (NPS) & Hon’ble Prime Minister Shri Manmohan Singh of Congress (UPA) was in power from 2004 to 2014 continued to accept these pension reforms.
The New Pension Scheme (NPS) was announced on December 22, 2003 by the NDA Government, for all new government employees excepting those in the Armed Forces. This brand new system replaces the defined benefit system of pension and this includes GPF. Contributory pension scheme is for entrants who joined after 1st January 2004.

While the NPS is mandatory for the Central government employees, it has potentially a much wider reach. As of March 2007, 19 states which have decided to introduce similar schemes, mandating newly recruited civil servants to mandatorily join the NPS‐type scheme.

The NPS started with the decision of the Government of India to stop defined benefit pensions for all its employees who joined after 1 January 2004. While the scheme was initially designed for government employees only, it was opened up for all citizens of India in 2009. Over 15 lakhs Government employees are currently registered in NPS scheme.

The Department of Economic Affairs (DEA) at the Ministry of Finance, notified a new pensions regulator in August 2003, before the NPS commenced operations in January 2004. The PFRDA bill was presented in 2005, and was finally passed in Parliament in 2013.

Let us analyse why Government is adopting the pension reforms:

Sl. no Indian Government View Employees view
1 The ratio of retirees to workers is on continuous rise and further by 2030 the 25% of the population (200 million pensioners) will be above 60 years of age. The large number of employees are effected by the New Pension reforms, hence Government should keep it in mind the interest of the large chunk   of employees
2 The Pension system shall put enormous financial pressure on the Government and take away funds meant for social cause spending, this will cause a drain on the state of economy. About 80 % of employees are Group “C” workers, the pension amount is ultimately spent by them for their daily needs and money flows into the market and economy will not be effected , secondly Government is a model employer and it has social responsibility towards its employees.

After a decade of existence, there is need to examine the existing NPS and compare the performance of this system to the goals with which it was created.

*One of the key bottlenecks has been the lack of a sound regulatory framework, put in place by an empowered and independent regulator. The PFRDA Bill that had been pending since 2002 was finally passed in 2013. This enables the formal institutionalisation of the PFRDA as the regulator of the NPS. The PFRDA can now take on the task of both the relatively short term agenda of closing the gap between the current NPS and the original design.

*Central government employees can invest in these assets only through their Tier II account which get higher returns on longer period.

  • After the enactment of the Pension Fund Regulatory and Development Act, 2013, it is not the exclusive liability of the government to pay the pension.”
    The Ministry of Finance will oversee and supervise the Pension Funds through a new and independent Pension Fund Regulatory and Development Authority.”

WHAT IS THE NATIONAL PENSION SCHEME?
Each Government employee contributes 10 % of his salary (Basic Pay + DA + DP) to the pension account , which is then matched by a Government contribution of an equal amount .

National Pension Scheme or New Pension scheme is a pension plan offered by the government. Investment in this scheme is via debt and equity market. The invested amount is locked until retirement. At retirement age, you can withdraw 60% of the maturity amount while the balance40% must be invested in annuity. The maturity amount is taxable. The NPS is regulated by the PFRDA and fund management is by designated fund managers from the private and public sector. NPS has the lowest charges.

From our salaries and daily allowance, 10 per cent is cut towards pension and an equal amount is given by the government. This amount is invested into the share markets under the new scheme.

An NPS subscriber can withdraw 25% of his contribution to the corpus for emergencies before retirement. Instead of withdrawing the entire amount at retirement, you can withdraw Rs 25,000, or 25% of your contribution, earlier, without any tax incidence. The remaining Rs 1.75 lakh is withdrawn on retirement.

New Pension Scheme extension of benefits of Retirement Gratuity and Death Gratuity to the Central Government employees covered by New Defined Contribution Pension System (National Pension System)-regarding. All these condition would be equally applicable for grant of gratuity to employees covered under New Pension Scheme.

An individual can claim tax deduction of upto 10 percent of the salary contributed towards NPS under Section 80 C. For those contributing through the corporate scheme, an employee can claim tax deduction on contribution made by the employer, not exceeding 10 percent of his basic salary plus dearness allowance (if any) Under Section 80 CCD (2). This is above the overall limit of Rs.1 lakh offered under Section 80C.

How New Pension Scheme (NPS) is affecting the Government employees.

The New Pension Scheme is highly disadvantageous to the Government employees under the present situation the pension amount is invested into the share markets under the new scheme. If the markets are doing well, the employees will get a good pension if the share market fails no pension is available to them. Under the old system, employees would get a fixed amount as pension that was 50 per cent of their last basic salary. When the salary was hiked, the pension amount too would be revised. Under the present NPS system, there is no security as pensions depend on market conditions. Secondly the NPS is highly disadvantageous if the length of the Government service is less if a employee serves for 20 years, he draws a pension of about Rs 3,000/- to Rs 5,000/ only. If he completes 33 years of service he draws about Rs 12,000/- to Rs 15,000/- compared to Rs 15,000/- to Rs 20,000/- in the old pension system, this new pension system needs a deep study and its minimum pension should be at least 50% of the last pay drawn. It is upto the Government how and where the money is invested, but a minimum guarantee of 50% of the last pay drawn should be assured by the Government to the employee.

Under New Pension Scheme is in reality much steeper than what the quantum of pension would indicate the differential treatment for those retiring under Old Pension scheme and New Pension Scheme, would be according differential treatment to pensioners who form a class irrespective of the type of retirement and, therefore, would be violate of Art. 14. It was also contended that classification based on fortuitous circumstance of retirement in old or New Pension Scheme, fixing of which is not shown to be related to any rational principle, would be equally violate of Art. 14.

Pension Scheme around the Globe : The USA, Canada, United Kingdom, China , Germany etc. Governments have a scheme of a Defined Benefit (DB) pension is where you receive a specific amount of pay out that is guaranteed by employer, regardless of how their pension investment performs. Your defined benefit amount depends on how much is paid into the plan and your years of service with that employer.

CONCLUSION:The Indian Government should also have a similar Defined Benefit (DB) pension scheme like other major countries in the world have, as many state Governments are re thinking on the New Pension Scheme, hence this New Pension Scheme should be remodelled to suit the Government employees. The Government should take up more social responsibilities of protecting its employees.

We request the government to reintroduce the old pension system. For this a greater movement should take place amongst the New Pension Scheme employees forcing Central Government to rethink the new pension policy adopted after 2004.

P.S.Prasad
Working President
COC Karnataka

Source: http://karnatakacoc.blogspot.com/

Be the first to comment - What do you think?  Posted by admin - December 9, 2018 at 2:35 pm

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National Pension Scheme: Good News for central government employees! Government contribution to NPS to rise to 14% of basic salary

National Pension Scheme: Good News for central government employees! Government contribution to NPS to rise to 14% of basic salary

In a bonanza for government employees, the Cabinet Thursday raised the government’s contribution to National Pension Scheme (NPS) to 14 per cent of basic salary from the current 10 per cent, sources said. Minimum employee contribution will, however, remain at 10 per cent. The Cabinet also approved tax incentives under 80C of the Income Tax Act for employees’ contribution to the extent of 10 per cent, they added. Presently, the government and employees contribute 10 per cent of basic salary each to NPS.

While the minimum employee contribution remains at 10 per cent, the government contribution has been increased from 10 per cent to 14 per cent. The Cabinet, headed by Prime Minister Narendra Modi, also allowed government employees to commute 60 per cent of the fund accumulated at the time of retirement, up from 40 per cent at present. Also, employees will have the option to invest in either fixed income instruments or equities, sources said.

As per the Cabinet decision, if the employee decides not to commute any portion of the accumulated fund in NPS at the time of retirement and transfers 100 per cent to annuity scheme, then his pension would be more than 50 per cent of his last drawn pay, sources said. The government did not announce the decision in view of the ensuing polls in Rajasthan Friday. While the government is yet to decide on the date of notification of the new scheme, sources said such changes usually come into effect from the beginning of a financing year, meaning April 1, 2019. This formula for changes in the NPS was worked out by the Finance Ministry based on the recommendation of a government-appointed committee.

Be the first to comment - What do you think?  Posted by admin - December 7, 2018 at 1:12 pm

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Provision and rules for NPS part withdrawal

Provision and rules for NPS part withdrawal

Provision and rules for NPS part withdrawal
  1. The partial withdrawal can be made to the limit of 25% of the contributions made by the subscribers, but excluding contributions made by the employer.
  2. The purpose of withdrawal is defined by the PFRDA. The purpose of withdrawal include treatment of specified illness of a family member, education of children, wedding expenses of children and purchase or construction of house.
  3. The education expenses can be made for the subscriber’s own children including the legally adopted children.
  4. The marriage expenses can be a reason for withdrawal so long as the subscriber’s own child is getting married, including his/her legally adopted child.
  5. To be able to withdraw the money for construction of house, the subscriber must make sure that the house belongs to him/her or in a joint name with his/her legally wedded spouse, that too if the subscriber doesn’t own more than one house besides the ancestoral property.
  6. For the treatment, the permission to withdraw upto 25% can be made allowed only if the diseases suffered fall in the category of diseases such as cancer, kidney failure, multiple sclerosis, major organ transplant, stroke, heart valve surgery, coma, paralysis and total blindness, among a few other major ailments.
  7. The subscriber can withdraw for a maximum of three times during the entire tenure of subscription.
  8. For withdrawal, subscriber must make the request to the central record keeping agency or the national pension system trust through the nodal office.
  9. In case the subscriber is suffering from an ailment, as mentioned in the clause, the request can be made by a subscriber’s family member.
  10. The rules have been effective from January 10, 2018 onwards.

2 comments - What do you think?  Posted by admin - December 3, 2018 at 9:24 pm

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NPS To OPS: Government of Andhra Pradesh Issued Orders based on Expert Committee

NPS To OPS: Government of Andhra Pradesh Issued Orders based on Expert Committee

National Pension System To Old Pension Scheme

Govt of AP Issued Orders based on Expert Committee

“In case it is to withdraw the Contributory Pension Scheme and in lieu of it to implement the Statutory Pension Scheme, what will be the legality of such a decision with respect to those who have already retired from service after serving under the Contributory Pension Scheme? or expired while in service?”

GOVERNMENT OF ANDHRA PRADESH

ABSTRACT

Contributory Pension Scheme (CPS/NPS)- An Expert Committee for review of the Contributory Pension Scheme and examining demand for continuing Old Pension Scheme – Constituted – Orders – Issued.

FINANCE (HR.3-PENSION-I) DEPARTMENT

G.O.R .RT.No. 2052

Dated: 28-11-2018

Read the following : –

1. G.O.Ms.No.653 Finance(Pen-1) Department, dated: 22.09.2004.
2. G.O.Ms.No.654 Finance(Pen-1) Department, dated: 22.09.2004.
3. G.O.Ms.No.655 Finance(Pen-1) Department, dated: 22.09.2004.
4. Representations from various Service Associations, public representatives for restoration of Old Pension Scheme.

ORDER :

In G.O. 1st to 3rd read above, Government of Andhra Pradesh adopted the Government of India’s New Pension Scheme based on Defined Contributions for the employees of the State, who are newly recruited on or after 01.09.2004.

2. Several representations and requests have been received from various service associations and people representatives for de-adoption of Contributory Pension Scheme and restoration of Old Pension Scheme for the State Government employees.

3. Keeping in view of the representations from the service associations and people representatives, the Government hereby constitute an Expert committee with the following composition.

1 Sri. S.P.Tucker, IAS (Retd),

Former Chief Secretary to Government

: Chairperson
2 Sri. Peeyush Kumar, IAS ,

Secretary to Govt (FP), Finance Department

: Member Secretary
3 Sri. D.Venkata Ramana,

Secretary to Government, Law Department

: Member
4 Prof. K. Muniratnam Naidu

(Retd),

Professor in Economics, S.P.Mahila University, Tirupathi

: Member
5 Prof Galab

Professor in Economics,

Director, CESS, Hyderabad

: Member

4. Terms of reference for the committee:

i. To submit a detailed report analysing the repercussions, both legal and financial of reviewing the Contributory Pension Scheme now in force.

ii. To submit a detailed report analysing the impact of Contributory Pension Scheme on the State Finances.

iii. To suggest propositions regarding the liabilities and risks that may arise out of the agreements entered into with NPS trust and NSDL.

iv. In case it is to withdraw the Contributory Pension Scheme and in lieu of it to implement the Statutory Pension Scheme, suggest propositions for refund of the contributions made by the employees & employer so far?

v. In case it is to withdraw the Contributory Pension Scheme and in lieu of it to implement the Statutory Pension Scheme, what will be the legality of such a decision with respect to those who have already retired from service after serving under the Contributory Pension Scheme? or expired while in service?.

vi. To analyse the status of the scheme in detail and the experiences and current scenarios of other states that have implemented the Contributory Pension Scheme.

vii. In case if the scheme is continued, what are the various steps that can be taken to make it more attractive/beneficial?

viii. To make suggestions in other matters that the committee finds relevant with regard to the review of the Contributory Pension Scheme.

5. The term of the committee shall be 3 months from the date of issue of orders.

(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)

ANIL CHANDRA PUNETHA

CHIEF SECRETARY TO GOVERNMENT

Source: Confederation

Be the first to comment - What do you think?  Posted by admin - November 30, 2018 at 4:27 pm

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NPS to OPS: Proceeding on adoption of Resolution on Abolishing NPS by Delhi Assembly

National Pension System to Old Pension Scheme

Proceeding on adoption of Resolution on Abolishing NPS

Proceeding on adoption of Resolution on Abolishing NPS by Delhi Assembly- एन.पी.एस को समाप्त करने के संकल्प पर दिल्ली विधान सभा की कार्यवाही

LEGISLATIVE ASSEMBLY

NATIONAL CAPITAL TERRITORY OF DELHI
Bulletin Part-I

delhi-assembly-proceeding-on-nps-resolution

(Brief summary of proceedings)

Monday, 26 November 2018 / 05 Margshirsha 1940 (Saka)

No. 91

10. 6.51 PM Calling Attention (Rule-54) :

Shri Ajay Dutt called the attention of the Government towards “Abolishing National Pension System (NPS) and reinstate the old Pension System in the interest of lakhs of Government Servants“.

Sh. Arvind Kejriwal, Hon’ble Chief Minister made a brief statement.

The following Resolution moved by Sh. Ajay Dutt was put to vote and adopted by voice-vote :

The Legislative Assembly of NCT of Delhi, having its sitting on 26 November 2018 :

Taking note of the negative consequences of the anti-employee National Pension System (NPS) that is imposed on the Government Servants by the then NDA Government in 2004 and sustained by the UPA-I, UPA-II and NDA-II Governments,

Given the fact that, unlike the old pension scheme, the NPS :

  • does not give any guarantee to the employees either for assured returns on investments or for minimum pension.
  • does not provide for family pension or social security,
  • does not provide for loan facility when in dire need,
  • does not provide for annual increments and hike in DA,
  • does not allow the employees to withdraw enough money from their own pension fund to meet the medical emergencies,
  • leaves the employees at the mercy of volatile markets and the forces that have notoriously been manipulating the markets,
  • imposes draconian restrictions on withdrawals from pension fund,
  • allows the insurance companies to exploit employees by way of forcing them to buy annuity for a minimum of ten years even after retirement, and
  • runs contrary to the spirit of welfare state as enshrined in the Constitution,

Given the fact that the pro-people and welfare oriented Government of NCT of Delhi is strongly in favour of restoring the rights and privileges of its employees by way of replacing the NPS with the time tested old pension scheme,

Resolves to urge upon the Government of India to scrap the NPS with immediate effect and bring at once all the Government Servants working under the Government of NCT of Delhi under the old pension scheme and restore to them all the benefits of the old pension scheme wherein the fair and legitimate pensions’ benefits are disbursed through the Consolidated Fund of India, so that the dedicated work force of the Government of NCT of Delhi and their families will be able to lead their lives with sense of security and dignity, and

Further resolves to urge upon the Government of India to restore t he old pension scheme in place of NPS or the benefit of all the Government Servants working under the Government of India and also to actively encourage other States to follow this true welfare measure”

Source: Delhi Assembly

Be the first to comment - What do you think?  Posted by admin - November 29, 2018 at 8:39 am

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Resolution adopted by the Legislative Assembly of NCT of Delhi to call the attention of Hon’ble Deputy Chief Minister to abolish National Pension System (NPS) and reinstate the Old Pension System in the interest of lakhs of Government Servants

NPS to OPS: Resolution adopted by Legislative Assembly of NCT of Delhi

Resolution adopted by the Legislative Assembly of NCT of Delhi – Abolish National Pension System (NPS) and reinstate the old Pension System

National-Pension-System-Old-Pension-System

NPS to OPS: Resolution adopted by Legislative Assembly of NCT of Delhi

Resolution adopted by the Legislative Assembly of NCT of Delhi – Abolish National Pension System (NPS) and reinstate the old Pension System

LEGISLATIVE ASSEMBLY SECRETARIAT
NATIONAL CAPITAL TERRITORY OF DELHI
Old Secretariat, Delhi – 110054

No.F.22(3)/Resolutions/2015/LAS-VI/Leg./

Dated: /11/2018

To

1. The Hon’ble Minister of Personnel, Public Grievances and Pensions
Government of India
North Block, New Delhi – 110 001

2. The Hon’ble Deputy Chief Minister,
Government of NCT of Delhi
I.P. Estate, New Delhi – 110002

Sub: Resolution adopted by the Legislative Assembly of NCT of Delhi to call the attention of Hon’ble Deputy Chief Minister to abolish National Pension System (NPS) and reinstate the Old Pension System in the interest of lakhs of Government Servants’.

Sir,

The Legislative Assembly of the National Capital Territory of Delhi unanimously adopted the following resolution moved by Shri Ajay Dutt, Hon’ble Member of Legislative Assembly in its sitting held on 26/11/2018:

“The Legislative Assembly in its sitting on 26 November 2018 resolves that:

Taking note of the negative consequences of the anti-employee National Pension System (NPS) that is imposed on the Government Servants by the then NDA Government in 2004 and sustained by the UPA-1, UPA-II and NDA-II Governments,

given that fact that, unlike the old pension scheme, the NPS;

does not give any guarantee to the employee either for assured returns on investments or for minimum pension,

does not provide for family pension or social security,

does not provide for loan facility when in dire need,

does not provide for annual increments and hike in DA,

does not allow the employees to withdraw enough money from their own pension fund to meet their medical emergencies,

leaves the employees at the mercy of volatile markets and the forces that have notoriously being manipulating the markets,

imposes draconian restrictions on withdrawals from pension fund,

allows the insurance companies to exploit employees by way of forcing them to buy annuity for minimum of ten years even after retirement, and

runs contrary to the spirit of welfare state as enshrined in the Constitution.

Given the fact that the pro-people and welfare oriented Government of NCT of Delhi is strongly in favour of restoring the rights and privilleges of its employees by way of replacing the NPS with the time tested old pension scheme.

Resolves to urge upon the Government of India to scrap the NPS with immediate effect and bring at once all the Government Servants working under the Government of NCT of Delhi under the old pension scheme and restore to them all the benefits of the old pension scheme wherein the fair and legislative pensions benefits are disbursed through the Constitutinal Fund of India, so that the dedicated work force of the Government of NCT of Delhi and their families will be able to lead their lives with sense of security and dignity, and further resolves to urge upon the Government of India to restore the old pension scheme in place of NPS or the benefit of all the Government Servants working under the Government of India and also to activity encourage other States to follow this true welfare measure.”

Yours sincerely,

(C.Velmurugan)
Secretary (L.A.)

No.F.22(3)/Resolutions/2015/LAS-VI/Leg./2982

Dated: 27.11.2018

Copy for information and necessary action to:

1. Chief Secretary, Govt. of NCT of Delhi, Delhi.
2. Principal Secretary to Lt. Governor, Govt. of NCT of Delhi, Delhi.
3. Principal Secretary (Services), Govt. of NCT of Delhi, Delhi.
4. Additional Secretary to the Chief Minister, Govt. of NCT of Delhi, Delhi.

sd/-
(Shnil Dutt Sharma)
Deputy Secretary (Legislation)

Source: Confederation

Be the first to comment - What do you think?  Posted by admin - November 28, 2018 at 1:44 pm

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Old Pension Scheme (OPS) Will Be Restored in Delhi

Old Pension Scheme (OPS) Will Be Restored in Delhi
Kejriwal said a resolution to restore the old pension scheme would be passed in a special session of the assembly. “It will then be sent to the Centre for approval. I will fight with the Centre to get it implemented.”

OLD-PENSION-SCHEME-OPS

Delhi chief minister Arvind Kejriwal announced on Monday, November 26, that the old pension scheme will be restored by his government and he will write to his counterparts in other states to follow suit.

Kejriwal said a resolution to restore the old pension scheme in the city will be passed in a special session of the legislative assembly.

“It will then be sent to the Centre for approval. I will fight with the Centre to get it implemented,” Kejriwal said while addressing a rally organised by the All Teachers, Employees Welfare Association (ATEWA) at Ramlila Ground here.

He said that he would also speak to his counterparts in West Bengal, Kerala, Andhra Pradesh and Karnataka for implementation of the scheme.

“The government employees have the power to change the government of the country. I want to warn the Centre, if the demand of employees is not accepted in three months, there will be an apocalypse in 2019,” the Aam Aadmi Party (AAP) convener said.

Slogans like “desh ka neta kaisa ho, Kejriwal jaisa ho” greeted the Delhi chief minister as he made the announcement at the rally.

Kejriwal slammed the new pension scheme as “betrayal and cheating” with government employees.

“I want to request Modiji that you cannot accomplish nation-building by disappointing the government employees,” he said, adding that the AAP government could perform in the areas of education, health, power and water supply only because of the cooperation of its employees.

The new pension scheme was introduced by the Centre in 2004. Under it, employees contribute towards pension from their monthly salary along with an equal contribution from their employer. The funds are then invested in earmarked investment schemes through pension fund managers.

PTI

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Why Government Employees Are Up in Arms About the New Pension Scheme (NPS)

Why Government Employees Are Up in Arms About the New Pension Scheme (NPS)

Unlike the old scheme, government employees are now forced to fund half of their pension themselves. This has caused indignation and sparked widespread protests.

On November 16, Union minister Piyush Goyal was reportedly hounded out of an event in Lucknow by railway employees. Among other issues, the protesters were angry about the new pension scheme and demanded the restoration of the old system.

Not just Uttar Pradesh, unrest against the scheme has been brewing across the country and often manifests in mass protest demonstrations.

Forget sustenance, several recently retired government employees say they can’t even pay their monthly electricity bills with the pension amount.

Many of these employees covered under the new contribution-based pension system are receiving as little as Rs 700-800 as monthly pension while the minimum guaranteed amount in the old defined benefit scheme is Rs 9,000. They are now required to pay 10% of their monthly wages which is matched by the government and invested in equity shares. Retirement pensions are dependent on the returns on that accumulated investment.

In the old system, the entire pension amount was borne by the government while fixed returns were guaranteed for employee contribution to the General Provident Fund (GPF). The government pays 50% of the last drawn salary plus dearness allowance (DA) as pension to employees after retiring, and to their dependent family members in case of death.

 

What is the new pension scheme and how is it different from the old one?

The National Pension System (NPS) is a defined contribution scheme mandatory for all new recruits to the Central government (except armed forces) joining on or after January 1, 2004. All state governments, except West Bengal, have also made it mandatory.

In 2009, the scheme was extended to all Indian citizens from 18-60 years of age, however, the 10% government contribution is only for government employees. An independent Pension Fund Regulatory and Development Authority (PFRDA), set up in 2013, regulates the NPS.

The NPS has two tiers – Tier 1 is mandatory for all government employees and has a fixed lock-in period. Subscribers can only withdraw the accumulated wealth after they retire, i.e., are 60 years old. A recent amendment allows them to withdraw 25% of the employee contribution in case of emergencies.

Even at the time of retirement, subscribers can withdraw only 60% of the total amount, which is taxable, and it’s mandatory to invest the rest 40% to buy a lifelong annuity scheme through an IRDA-regulated insurance company. If they leave the scheme or retire before attaining the age of 60, 80% of the pension wealth has to be invested in the annuity scheme.

Tier 2 is a voluntary account, more of a substitute for the GPF where one can withdraw any amount at any time. The government does not contribute anything in the tier 2 account.

Unlike the pension and GPF in the old scheme, the NPS does not guarantee any fixed returns as it is market-linked.

 

Teething troubles or discriminatory by design?

Since the NPS covers employees recruited after December 2003 and the age of retirement is 60, most employees are yet to avail the new pension benefits.

On being asked why they were protesting more than a decade after the old scheme was replaced, the employees say they initially had little understanding of the scheme as there were no active efforts to educate them or raise awareness about it.

They were told that NPS was better as the government was also matching their contributions. “Many employees have been protesting from the start but NPS was forced on us nevertheless. Such large-scale movements take time. We were fewer in number and it took time to organise,” Manjeet Singh Patel, Delhi state president of the National Movement for Old Pension Scheme (NMOPS)

Many experts and supporters of the scheme argue that just like a standard Systematic Investment Plan, long-term capital gains under NPS would be better than before. However, protesting employees argue that for those retiring after 10-12 years under NPS, the accumulated wealth is too less to provide substantial amount as pensions.

“The total accumulated wealth in my NPS account on retirement was Rs 3.25 lakhs even when I got 13% interest rate on it. After 60% of it was paid to me on retirement, I am receiving less than Rs 700 every month as pension through the annuity scheme,” R.P. Bhatia, a former employee of the Haryana electricity board, told The Wire.

Bhatia was made permanent in November 2006 and retired in 2013. NPS was enforced in Haryana from 2006 itself. He says his colleagues who were recruited not long before him are receiving over Rs 15,000 as pension under the old scheme.

To be sure, employees did not need to contribute anything to avail pension in the earlier scheme. Under NPS, employees have to fund half of their pension themselves.

If they want a GPF-like option where there’s no strict lock-in period, they have to additionally deposit money in the tier 2 account. They say this leaves them with less disposable income and even then, they live in constant anxiety of losing their money in the equity market.

“If the government wanted to encourage us to invest in mutual funds, we should have been educated about it and it should be optional for those willing to risk it. The government is forcing us into it instead of providing a safety net,” Patel added.

In addition to these issues, government employees from many parts of Uttar Pradesh allege their contribution hasn’t even started being deducted from their salaries. “How will we get returns from the market when our money hasn’t even been deducted from our accounts to be invested,” Ajit Verma, a 32-year-old government employee from Lakhimpur Kheri in UP, told The Wire. He adds that this is the case in many blocks of his district.

 

Speculative benefits instead of safety net

“The minimum pension amount under the old scheme is Rs 9,000 which has been calculated keeping in mind entry-level minimum wages. Real pension amounts are much higher as nobody retires on entry-level wages. In the new scheme, even those who have worked for a decade are getting as little as Rs 1,000-2,000. This is a disastrous policy,” Tapan Sen, general secretary, Center of Indian Trade Unions, told The Wire.

Sen also alleges that both the Congress and BJP governments, through this scheme, have been using public money to help those who profit through speculation in the share market at the cost of vulnerable government employees.

In addition to nervousness because of a mistrust in market-linked schemes, the employees also feel they are being discriminated against as armed forces recruits are still covered under the old scheme and they feel their fellow colleagues covered under the old scheme are getting a better deal.

Clearly defined pension amounts and a safety net in the form of fixed interest rates on GPF were the main attractions for a government job for these employees who typically spend their whole working lives in the public sector.

 

Current state of economy adding to woes

The current state of the economy does nothing to inspire confidence in these employees as they see their interest rates dip in the aftermath of events like demonetisation and Goods and Services Tax.

“We were told that our money in the market would also help avoid a 2008-like economic slowdown. How are we to trust this logic when people like Vijay Mallya and Nirav Modi run away with thousands of crores of public money? When even our pension fund managers like SBI goes into massive losses?” Vijay Kumar, national president of the NMOPS, told The Wire.

A rare moment of unity among government employees

As word spreads of an organised movement against the new pension scheme, employees from various government departments and states are joining in. Leaders of the movement say this is one of the rare issues that has united government employees from very diverse sectors and geographical locations.

Workers from the banking sector are also lending their voice to the protest. A charter of demands submitted to the Indian Banks’ Association by the All India Bank Officers’ Confederation also demands scrapping of the NPS.

“Either we go to the old scheme or this scheme can itself be converted into an assured pension scheme. We have also given a workaround on how it can be done. If invested properly, it is possible to guarantee assured income. Instead of investing in the market, the fund can be used in lending activities. Retail lending can alone fetch 12-15% interest and we can avoid the whims of the market,” Thomas Franco, former general secretary of AIBOC, told The Wire. Even while suggesting how to ease anxieties regarding market volatility, Franco’s preference remains going back to the old scheme.

Since no concrete action was taken to address their concerns even after multiple appeals to all concerned authorities, the NMOPS has planned to mobilise lakhs of government employees from across India and march to the parliament on Monday.

Source: thewire.in

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Future course of action of NJCA on Minimum Wage, Fitment Formula, NPS and Other issues

Important NJCA Meeting on 4.12.2018
Future course of action of NJCA on Minimum Wage, Fitment Formula, NPS and Other issues

Meeting of National Joint Council of Action on 4th December 2018
NJCA
National Joint Council of Action

4, State Entry Road New Delhi – 110055

No.NJCA/2018

Dated November 21, 2018

All Members of the NJCA

Dear Comrades,

Sub: Meeting of the NJCA

Ref : This office letter of even number dated 14th November, 2018

It has been decided to hold meeting of the National Joint Council of Action (NJCA) on 4th December 2018 from 16:00 hrs in JCM Office, 13-C, Ferozshah Road, New Delhi, to take stock of the current situation in regard to non-settlement of major pending issues, viz

(i) Improvement in Minimum Wage and Fitment Formula

(ii) No Progress in respect of NPS Covered Central Government Employees

(iii) Other pending issues related to National and Departmental Anomalies.

All of you are requested to make it convenient to attend the aforementioned meeting of the NJCA, so as to take the consensus decision for future course of action in the prevalent scenario.

With Fraternal Greetings,

sd/-
Comradely yours,
(Shiva Gopal Mishra)
Convener

Source : Confederation

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NFPE CALLS UPON POSTAL EMPLOYEES TO MAKE 2019 JANUARY 8th & 9th TWO DAYS STRIKE – A GRAND SUCCESS

NFPE CALLS UPON POSTAL EMPLOYEES TO MAKE 2019 JANUARY 8th & 9th TWO DAYS STRIKE – A GRAND SUCCESS

THE FOLLOWING IS THE EDITORIAL PUBLISHED IN ‘POSTAL CRUSADER’ THE OFFICIAL ORGAN OF NATIONAL FEDERATION OF POSTAL EMPLOYEES (NFPE)

IMPORTANCE OF JANUARY 2019 TWO DAYS STRIKE

National Convention of Workers organized by Central Trade Unions (except BMS), independent Federations and Associations viz; Central Government and State Govt. Employees, Banks, Insurance, Defence production employees etc, held at Mavlankar Hall, New Delhi on 28th September 2018, has decided to conduct two days nationwide strike on 8th& 9th January 2019. Earlier, Confederation of Central Govt. Employees & Workers, in its National Convention held at Hyderabad on 10th June 2018, has decided to go for one day’s nationwide strike on 15th November 2018, demanding settlement of 10 points Charter of demands of Central Govt. Employees, Pensioners, Gramin DakSevaks and casual/contract workers. In the changed circumstances, Confederation has decided to postpone the 15th November 2018 one day strike and to join the two days strike on 8th and 9thJanuary 2019 announced by the National Convention of Workers. There is no change in the 10 points charter of demands of Confederation adopted in the Hyderabad National Convention.

The declaration adopted in the National Convention of Workers held on 28th September 2018 has stated as follows:

“Government is dragging its feet on wage negotiations of public sector in bipartite settlement and 7th Central Pay Commission anomalies of Central Government employees. Four sub committees were formed by the Government to address several issues raised by Central Government employees (NJCA) such as scrapping of New Pension Scheme (NPS) review of Minimum wage and fitment formula, restoration of allowances and allowing option-I as one of the pension benefit formula. But nothing has been done.

The Central Government Employees organisations including the Defence and Railways have been planning united action against the betrayal of the Government and asserting their genuine demands including scrapping of New Pension Scheme. This National Convention extends full support to their struggle and upholds all their demands.”

Thus, the entire Trade unions (other than BMS) has taken serious view of the negative attitude of the Central Government towards the demands of Central Government employees and Pensioners and extended full solidarity and support to our struggle.

Unrest among the New Pension Scheme (NPS) employees is rising day by day. Those NPS employees who retired from service, in 2015 to 2018, after completing ten years’ service are getting a paltry sum of Rs.1000 to 3000 only as monthly annuity pension. How can a pensioner and his family live with such a megre amount as pension. This is equal to “No Pension”, Under the Old Pension Scheme (OPS) an employee who completed minimum ten yearsservice is eligible for 50% of last pay drawn as minimum pension.

Regarding increase in Minimum Pay and Fitment formula, the assurance was given to the NJCA leaders by none other than the Hon’bleHome Minister and Finance Minister on 30.06.2016. Two years are over but nothing happened. Government has replied in Parliament that, at present, there is no proposal for increasing Minimum Pay and Fitment formula. Thus the entire Central Govt. Employees are betrayed. Regarding Pensioners, the one and the only favourable recommendation of the 7th CPC i.e. Option-I, stands rejected by Government.

Three lakhs GraminDakSevaks of the Postal department conducted a heroic strike for sixteen days and finally Govt. was compelled to accept their demands.But while issuing orders, eventhough new pay scale recommended by the Kamalesh Chandra Committee is implemented, regarding arrears the Committee’s recommendation was rejected and modified by Govt. Some important recommendations like Children Education Allowance, Time bound three financial upgradations etc. are still pending. Regarding revision of wages of Casual Labourers, orders issued by Postal Directorate is yet to be implemented in some Circles and Divisions and their demand for regularisation is not considered favourably by Govt.

The situation in the country is deteriorating day by day. National economy including value of Indian currency, suffered serious setback due to pro-corporate, anti-labour and anti-people neo-liberal policies pursued by the Central Government, grievously impacting the livelihood of the working people and farmers.

The situation due to steep rise in petrol and diesel prices with cascading effect on increase in prices of all daily life utility items, especially food items, is resulting in torturous impact on common masses. The unemployment situation is getting aggravated with employment generation practically turned negative even in most labour-oriented sectors. The agricultural sector and farmers are in deep distress. The after-effects of demonitisation and faulty GST Continue to adversely impacting the deep crisis set in the fast-paced neo-liberal economic policies of the Government. Lack of job opportunities on the one hand and continued job losses, retrenchments, illegal closures on the other hand are imposing miserable condition on the ordinary families for their food, education of children and medical care of the sick and elderly, Aggressive move to sell the shares of the Public Sector undertakings and onslaught of privatization through various routes like outsourcing, PPP etc. is going on in full swing. The demand for universal social security with guaranteed pension has fallen on deaf ears.

Central Govt. not only refused to respond to the just and genuine demands of the organized agitation of working class, but has been continuing its aggression against the hard-won labourrights of the workers, employees and Trade Unions. It is in this background the entire working class of our country has decided to fight back the onslaught of the Govt. against the working class and peasants.

National Federation of Postal Employees (NFPE) has been in the forefront of the struggle against the neo-liberal policies of the Govt. especially against the negative attitude of the Govt. towards the Central Govt. Employees demands including Postal employees.

On January 8th& 9th, about 18 to 20 crores organized and unorganized workers will go on two days strike. NFPE HQ calls upon the entirety of Postal and RMS employees including GraminDakSevaks and Casual, Part-time, Contingent employees to join the strike en-mass. It is a struggle for our survival.

Source: Confederation

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Clarification on modalities of transfer of the NPS contribution to casual labourer with temporary status to their GPF accounts.

Clarification on modalities of transfer of NPS – DoPT Orders dt. 11.10.2018

No.49014/2/2014-Estt.(C)-PT.I
Government of India
Ministry of Personnel, PG and Pensions
Department of personnel & Training

North Block, New Delhi
Dated: 11th October, 2018

OFFICE MEMORANDUM

Subject: Clarification on modalities of transfer of the NPS contribution to casual labourer with temporary status to their GPF accounts.

The undersigned is directed to refer to this Department’s 0M No.51016/2/90-Estt (C) dated the 10th September, 1993 vide which a scheme for grant of temporary status to the casual employees was framed. The scheme applied to those casual labourers who were in employment on the date of the issue of the 0M and had rendered one year of continuous service in Central Government offices, which meant that they must have been engaged for a period of at least 240 days (206 days in the of offices observing days week). The scheme did not apply to Departments of Telecom & posts and Ministry of Railways.

2. As the scheme, after rendering three years’ continuous service after conferment of temporary status, the casual labourers were to be treated at par with temporary Group ‘D’ employees for the purpose of contribution to the General Provident Fund. Further, after their regularisation, of the service rendered under temporary status was to counted for of retirement benefits.

3. As per para 8 of the scheme, two out of every three vacancies in Group ‘D’ in respective offices where the casual labourers had been working was to be filled up as per extant recruitment rules and in accordance with the instructions issued by Department of Personnel and Training from amongst casual workers with temporary status. However, regular Group ‘D’ staff rendered surplus for any reason would have prior claim for absorption against existing/future vacancies.

4. Vide the O.M. No.49014/1/2004 -Estt.(C) dated the 26th April, 2004, the above scheme was reviewed in light of introduction of New Pension Scheme in respect of appointed to the Central Government service on or after 1.1.2004. These casual labourers with temporary Status were now to be considered under the NPS and their underlying amount in GPI was credited to them.

5. The 0M dated 26th April, 2004 was quashed by various benches of CAT/High Courts who had decided that the scheme could not modified retrospectively.

6. The position was reviewed in the light of the Court judgements in consultation with the Department of Expenditure. It was then decided vide this Department’s O.M. No. 49014/2/2014- Estt(C) dated 26.02.2016 and 0M. No. dated 28.07.2016 that the casual labourers who had been granted temporary status under the scheme, and have completed 3 years of continuous service after that were entitled to contribute to the General Provident Fund. It was also decided that of the service rendered under temporary status would be counted for the purpose of retirement benefits in respect of those casual labourers who have been regularised in terms of para 8 of the 0M dated 10.09. 1993. This was applicable to all casual labourers covered under the scheme Of 1993 whether they were regularised before or after 31.12.2003.

7. It was emphasised that the benefit of temporary status is available only to those casual labourers who were in employment on the date of the issue of the 0M dated 10th Septetmber, 1993 and were otherwise eligible for it. No grant of temporary status is permissible after that date. The employees erroneously granted temporary status between 10.09.1993 and the date of Hon’ble Supreme Court judgement in Union Of India And Anr vs Mohan Pal. 2002 (3) SCR 613, delivered on April, 2002, will however be deemed to have covered under the scheme of 10.09.93.

8. Subsequent to the issue of this Department’s O. M. 49014/2/2014-Esst(C) dated 26.02.2016 and O.M. No. 49014/2/2014-Estt(C) dated 28.07.2016 several Ministries/ Departments were seeking clarifications as regards to the modalities of transfer of the amount lying in the NPS account to the GPF account of these casual labourers. The matter has been examined in consultation with D/o Pensions & Pensioners’ Welfare, D/o Financial Services and D/o Expenditure.

9. D/o Pension and Pensioners’ Welfare have clarified/ stated that the employees’ share or the NPS subscription with interest should withdrawn and deposited in the GPE accounts if these CL-TS regularized after 31.12.2003 and the Government share with interest accrued under NPS should be deposited in Government’s account.

10. Controller General of Accounts (CGA) have furnished following clarifications vide letter No. dt 11.03.2016 on a similar matter which are as under:

(i) Adjustment of Employees contribution in Accounts:- Amount may be credited to individual GPF Account and the account may he recasted permitting up-to-dare interest (Authority-FR-16 & Rule / of GPF Rules)

(ii) Adjustment Of Government contribution under NPS in Accounts. TO be accounted for as (-) Dr. to object heads Recoveries under major Head 2071- Pension and Other Retirement benefit-Minor Head 911- Deduct Recoveries Of over payment (GAR 35 and para 3.10 of List of Major and Minor Heads of Accounts)

(iii) Adjustment of increased value of subscription on account of appreciation of investment- may be for crediting the amount Govt. account under Contribution towards pensions and other Retirement Benefits 800- Other Receipts (Note under the above Head in LMMHA).

11. The principle underlying the consideration of the case of CL(TS) is that Casual labourers Who were covered under the scheme Of 1993 and have been regularised in terms Of the above scheme were entitled to GPF and Old Pension scheme even if they were regularised after 31.12,2003.

12. Furthermore. as per Dio Expenditure/CGA, if the kr•nefits under old pension scheme are to allowed to a retired employee, who had contributed towards NPS at any stage. the entire NPS accumulations i.e. employee’s contribution + Government’s matching contribution + appreciation thereon should be remitted into the accredited bank of the PAO concerned and the accounting procedure will be same in this case as prescribed at par 10 above.

13. All Ministries/Departments are requested to settle the matter explained amve If any further clarification is needed in the matter, they should approach CGA (Controller General of Accounts) directly, since CGA is the accounting agency and is competent to clarify the matter.

sd/-
(N.Sriraman)
Director (Establishment)

Source: https://dopt.gov.in/

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Appeal to NPS Pensioners : NPS PENSIONERS – YOUR ATTENTION PLEASE – Confederation

Appeal to NPS Pensioners – Confederation
NPS PENSIONERS – YOUR ATTENTION PLEASE

As you are aware Confederation of Central Govt Employees & Workers has been opposing and fighting against the Contributory Pension Scheme (known as NPS) from the very beginning.

At the time of introduction of NPS, it is only Confederation Confederation, All India State Govt Employees Federation and the Left parties which strongly opposed it. Now a situation has developed that more than 50% of the employees in Central Government & State Government services and also in Central / State Public Sectors are NPS employees and even those Federations / Unions / Associations in the Central / State Govt services who were either confused or kept quite or supported Govt decision to introduce NPS in the initial stage are compelled to change their original stand and started raising their voice against NPS.

Confederation of Central Govt Employees & Workers, as an organization spear heading this struggle, is making intensive campaign against NPS and trying to build up a broad united movement of all like-minded organizations, so that a wider and bigger movement is built up no sooner than later, with an ultimate aim of organizing a nationwide indefinite strike to “SCRAP NPS” in future, if Govt is not ready to change their stand.

For effective campaign and also to expose the hollowness of the claim of the Govt and supporters of NPS, the following details of those NPS employees who have already retired from service is required.

(1) Name in full and Designation at the time of retirement:

(2) Name of the office and Department from which retired.

(3) Date of entry in service.

(4) Date of retirement.

(5) Completed years of service.

(6) Basic pay at the time of retirement.

(7) Amount of Insurance Annuity Pension being received now per month.

The information should be authentic.

All are requested to cooperate and furnish the above information before 31-10-2018.

M.KRISHNAN
Secretary General Confederation
Mob & WhatsApp: 09447068125
e-mail: mkrishnan6854@gmail.com

Source: Confederation

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Grant of old pension to the young employees working in the railway

Railway Board requests to Grant old pension to the young employees

GOVERNMENT OF INDIA (BHARAT SARKAR)
MINISTRY OF RAILWAYS (RAIL MANTRALAYA)
(RAILWAY BOARD)

 No.D-43/19/2017-F(E)III

Dated: 06.09.2018

Sh. Mangat Ram Saini,
National President,
Akhil Bhartiya Railway Mazdoor Sangthan,
125/R, Ram Nagar,
Pathankot-145001,
Mob.-9464000303.

Dear Sir,

Sub: Grant of old pension to the young employees working in the railway. Please refer to your letter dated 12.07.2018 on the above cited subject.

2. In this regard it is stated that the decision to implement the National Pension System (NPS) w.e.f. 01.01.2004 for all recruits, is of the Government of India. The Ministry of Railways being an administrative Ministry in respect of pensionary matters is bound to adhere to the decision taken by the Nodal department, i.e., Department of Financial Services (Ministry of Finance). The Ministry of Railways is not empowered to take any unilateral decision.

(G. Priya udarsani)
Director, Finance (Estt.),
Railway Board.

Old-Pensin-Railway-Employees

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Fixing of Remuneration in favour of Re-engaged Retired Employees covered under NPS

Fixing of Remuneration in favour of Re-engaged Retired Employees covered under NPS

GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
RAILWAY BOARD

No. 2018/Trans.Cell/S&T/Contractual Staff

New Delhi, dated: 12.09.2018

The General Manager, All Indian Railways/PUs, NF(Con), CORE
The DG/RDSO/Lucknow, DG/NAIR/Vadodara
CAOs, DMW/Patiala, WPO/Patna, COFMOW/NDLS, RWP/Bela, CAO/IROAF

Sub: Fixing of Remuneration in favour of Re-engaged Retired Employees covered under NPS.

Ref: (1) Board’s letter No. E(NG)-11/2007/RC-4/CORE/1 Dated- 16.10.2017.
(2) DRM/TVC’s Letter No. V/G.157/DRM/Re-engagement dated 28.08.2018.

With reference to DRM/TVC’s letter at (2) and Board’s letter at (1) above, Board (MS, FC & CRB) have approved that the remuneration of re-engaged retired employees covered under NPS may be suitably dealt with, on merit on case to case basis.

This issues with the concurrence of Associate Finance of Transformation Cell of Railway Board.

Kindly acknowledge the receipt and ensure compliance.

(Umesh Balonda)
Executive Director/S&T
Transformation Cell

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Reversion to Old Pension Scheme

Reversion to old pension scheme due to administrative delay

“NPS applicable to Government servants appointed to civil posts on or before 31.12.2003. The date on which the vacancies arose or the date on which the examination was conducted for filling up the vacancies is not relevant for deciding the applicability of the Central Civil Services (Pension) rules, 1972″

Reversion to old pension scheme

In accordance with the scheme for National Pension System (NPS), as notified vide Ministry of Finance (Department of Economic Affairs)’s Notification No. 5/7/2003-ECB & PR dated 22.12.2003, the System is mandatory for all new recruits to the Central Government service (except armed forces) from 01.01.2004. Accordingly, as per Rule 2 of the Central Civil Services (Pension) Rules, 1972, as amended on 30.12.2003, these rules are applicable to Government servants appointed to civil posts on or before 31.12.2003. The date on which the vacancies arose or the date on which the examination was conducted for filling up the vacancies is not relevant for deciding the applicability of the Central Civil Services (Pension) rules, 1972.

Ministry of Home Affairs have not sought any advice from Department of Pension and Pensioners’ Welfare on the question of having a policy to cover the paramilitary personnel appointed after 01.01.2004 under the Old Pension Scheme on the ground that the vacancies arose, or the examination was conducted, in the year 2003. However, a reference was received from Ministry of Home Affairs in a specific case relating to appointments as Sub-Inspector in various Central Para Military Forces after selection in August, 2003 on the basis of an Examination conducted in 2002.

Appointments on the basis of these selections were made in Central Reserve Police Force in 2003 and the candidates appointed were covered by the pension scheme under Central Civil Service (Pension) Rules, 1972. However, in the Border Security Force, offers of appointment on the basis of the same examination/selection were issued in January, 2004. On a petition filed by some personnel appointed in the Border Security Force on the basis of that examination, Hon’ble High Court of Delhi directed to cover the petitioners under the Central Civil Service (Pension) Rules, 1972 on the grounds of administrative delay on the part of Border Security Force in making appointments.

The order of Hon’ble High Court of Delhi was implemented by the Ministry of Home Affairs/Border Security Force in view of the peculiar circumstances of that case. The decision taken in that case is, however, not relevant for deciding applicability of Central Civil Service (Pension) Rules to all appointments made on or after 01.01.2004 in the Central Para Military Forces or in any other Department/organization on the basis of year of examination/selection.

This information was provided by the Union Minister of State (Independent Charge) Development of North-Eastern Region (DoNER), MoS PMO, Personnel, Public Grievances & Pensions, Atomic Energy and Space, Dr. Jitendra Singh in written reply to a question in Rajya Sabha on 19.7.2018.

Source: PIB

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Central Government Rejects the Demand to Scrap National Pension System

Central Government Rejects the Demand to Scrap National Pension System

Abolition of Contributory Pension Scheme

Representations have been received from various Associations of Government Employees on the problems being faced and the demand to withdraw the National Pension System (NPS). The 7th Central Pay Commission (CPC) also in its report examined the issues related to NPS and made recommendations for addressing these issues.

Pursuant thereto, it was decided to constitute a Committee of Secretaries to suggest measures for streamlining NPS. The Committee has submitted its report. Due to rising and unsustainable pension bill and keeping in view of fiscal imperatives, it is not possible for the government to revert back to old pension scheme.

This information was provided by the Minister of State in the Ministry of Finance Shri. Shiv Pratap Shukla in written reply to a question in Rajya Sabha on 24.7.2018.

Source: Confederation

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Conference on Implementation of National Pension System by Central Autonomous Bodies

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

PRESS RELEASE

Conference on Implementation of National Pension System by Central Autonomous Bodies

A conference on implementation of National Pension System by Central Autonomous Bodies (CABs) was organized by PFRDA on 13th June 2018 at New Delhi. The prime objective was to provide a forum to all Central Autonomous Bodies (CABs), where the progress in the implementation of NPS with respect to compliance of timelines in various NPS related activities could be brought to the fore and a way forward could be provided. Officials from most of the Central Autonomous Bodies (CABs) attended the conference.

Dr. Badri Singh Bhandari, Whole Time Member (Economics) in his opening remarks mentioned that currently there are 557 CABs which have about 1.73 lacs subscribers and about Rs.11800 crores of Asset Under Management (AUM). He further emphasised the need for discipline in submission of subscriber registration forms and remittance of the subscribers’ contributions. He also highlighted the responsibility of nodal officers handling NPS and advised that they should be aware of the NPS and its related process in detail for addressing the queries/grievances of the subscribers.

Chairman, PFRDA, Sh. Hemant Contractor, in his address emphasized the fact that NPS, being a Contributory scheme, was different from the earlier pension system and discussed various determinants of pension such as promptness of the Nodal offices in performing various NPS related activities mainly subscriber registration, upload/remittance of NPS contributions and also period of stay in the scheme, contribution level, returns on investments, annuity schemes chosen, annuity service providers chosen etc. In this regard, he stressed upon the need to work in tandem to ensure that NPS works efficiently and pensions are served effectively. He also highlighted endeavour of PFRDA in educating subscribers in handling their pension accounts, through a dedicated website, Pension Sanchay.

Secretary, Department of Expenditure, Govt. of India Sh. Ajay Narayan Jha, in his key-note address appreciated the initiative of PFRDA for holding this conference exclusively for Central Autonomous Bodies as it provided two-way communications between stakeholders for the ultimate benefit of the subscribers. He stressed to all participants on the need of becoming sensitive and responsible towards employee-subscribers currently covered under NPS in order to protect their interest, while monitoring various NPS related activities. He also stressed upon the role which can be played by the Head of Institutions and PrAOs of the respective CABs in streamlining NPS operations.

A presentation was also made by the NSDL e-Governance Infrastructure Ltd, the Central Recordkeeping Agency for NPS about the operational issues and new functionalities released for the convenience of the nodal officers-PAOs/DDOs and the subscribers. A presentation was also made by Jamia Millia Islamia University about the best practices they have adopted to administer the subscribers’ interface effectively. While presenting the Vote of Thanks Shri Ashish Kumar, GM mentioned that PFRDA is periodically holding Review meetings/ Video conferences also with the CABs on important parameters having financial implications and expects significant improvement from the present state of affairs.

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New Contributory Pension System (NPS) – Confederation

An Overview of New Contributory Pension System (NPS) – Confederation

NEW CONTRIBUTORY PENSION SYSTEM (NPS)

M.Krishnan

Secretary General

Confederation of Central Govt. Employees & Workers

Pension system was in vogue in India for a century or more and the British Government during the pre-independence era introduced Pension Rules for Government employees and thus made it statutory. In the year 1982 Supreme Court in its landmark judgement in Nakara’s case declared that – “as per India’s constitution, Government is obliged to provide social and economic security to pensioners and that Government retirees had the fundamental right to pension….. Pension is not a bounty nor a matter of grace depending upon the sweet will of the employer. It is not an ex-gratia payment, but a payment for past service rendered. It is a social welfare measure, rendering socio-economic justice to those who in the hey days of their life, ceaselessly toiled for their employers on the assurance that in their old age, they would not be left in lurch.”

During the advent of globalisation policies in 1980’s the pension reforms also started simultaneously. IMF & World Bank started publishing so many reports and documents emphasizing the need for pension reforms. They also started studying about the reforms to be undertaken in the pension sector in India. In 2001, “IMF work paper on pension reforms in India” and World Bank India specific report “India – the challenge of old age income security” were published. Their work reports emphasized that “Pension obligations or promises made by the Governments which have potential of exerting pressure on Govt. finances, have been a subject of increased focus in assessing medium to long term fiscal sustainability.” In tune with the dictates of IMF and World Bank BJP-led NDA Government appointed Bhattacharjee Committee in 2001 headed by Ex-Chief Secretary of Karnataka, to study and recommend pension reforms. Thus after creating ground for pension reforms, under the pretext of implementing recommendations of Bhattacharyya Committee, the NDA Government introduced New Pension System called Defined Contributory pension system for all employees who join service on or after 01-01-2004. The Congress-led UPA Government which came to power in 2004 continued with the reforms and promulgated an ordinance to legalise NPS. But UPA-I Govt. could not pass the Pension Bill in Parliament due to stiff opposition of Left Parties supporting it. Later when UPA-II Government came to power the Pension Regulatory and Development Authority (PFRDA) Bill was passed in the Parliament with the support of BJP, the then opposition party. Many State Governments governed by political parties other than Left Parties, introduced Contributory Pension System for their employees from various dates after 2004. Left Front Governments of Kerala, West Bengal and Tripura refused to introduce the New Pension Scheme and they continued with the old defined benefit pension scheme. Congress-led UDF Government introduced NPS in Kerala. After BJP coming to power in Tripura also Contributory Pension Scheme is introduced recently. In West Bengal old Pension Scheme continues even now. Not only newly appointed Central and State Government employees, almost all new entrants of public sector and Autonomous bodies are also brought under the purview of NPS.

As per New Contributory Pension Scheme an amount of 10% of pay plus Dearness Allowance will be deducted each month from the salary of the employees covered under NPS and credited to their pension account. Equal amount is to be credited by the Government (employer) also. Total amount will go to the Pension Funds constituted under the PFRDA Act. From the pension fund the amount will go to the share market. As per the PFRDA Act – “there shall not be any implicit or explicit assurance of benefit except (share) market based guarantee mechanism to be purchased by the subscribers”. Thus the amount deposited in Pension Fund may or may not grow depending on the fluctuations in the share market. After attaining 60 years of age i.e., at the time of retirement, 60% of the accumulated amount in the Pension Account of the employee will be refunded and the balance 40% will be deposited in an Insurance Annuity Scheme. Monthly amount received from the Insurance Annuity Scheme is the monthly pension i.e., Pension is not paid by Government, but by the Insurance Company and hence NPS is nothing but Pension Privatization..

Thus it can be seen that the growth of the accumulated amount in the Pension fund depends upon the vagaries of share market. If the share markets collapse, as happened during the 2008 world financial crisis, then the entire amount in the pension fund may vanish. In that case employee will not get any pension. Every fluctuation in the share market will affect the future of pension of those employees who are covered under NPS. Uncertainty about pension and retirement life looms large over their heads. Even if there is a stabilized share market the 40% amount in the annuity scheme is not enough to get 50% of the last pay drawn as pension, which is the minimum pension as per old pension scheme. Many employees who entered in service after 01-01-2004 has retired in 2017 and 2018 after completing 12 & 13 years of service. They are getting Rs.1400- to Rs.1700- only as monthly pension from Insurance Annuity Scheme. If they have entered service in 2003 i.e., in the old pension scheme, they would have got 50% of the last pay drawn as pension subject to a minimum of Rs.9000- as minimum pension, that too without giving any monthly contribution towards pension from their salary. In short, NPS is nothing but NO PENSION SYSTEM.

As per clause 12(5) of the PFRDA Act even the employees and pensioners who are not covered under NPS, can be brought under the Act by a Gazette notification by the Government. Thus NPS is a Damocles’ sword hanging over the head of all employees and pensioners.

Who is the beneficiary of this pension reforms? As in the case of every neo-liberal reforms, the ultimate beneficiary is the Corporates. The huge amount collected from the workers through pension fund is invested in share market by the Pension Fund Managers and this amount in turn can be utilied by the multi-national Corporates for multiplying their profit. Amount deducted and credited to the Pension fund from each newly recruited employees plus the employer’s share amount will remain with the pension fund and share market for a period of minimum 30 to 35 years i.e., till the age of 60 years. During this long period of 35 years crores and crores of rupees will be at the disposal of share market controlled by multinational corporate giants. Ultimate causality will be the poor helpless employee/pensioner.

Confederation of Central Government Employees and Workers and All India State Government Employees Federation (AISGEF) has been opposing the NPS from the very beginning and a one day strike was conducted on 30th October 2007. It was one of the main demand in all other strikes during these period. The campaign and struggle against NPS continued and as of now the subjective and objective conditions for a bigger struggle against NPS has emerged as almost 50% of the total employees in Central, State, Public sector and Autonomous bodies are now covered under NPS and are becoming more and more restive and agitated. 7th Central Pay Commission Chairman Retired Supreme court Judge Sri. Asok Kumar Mathur has correctly pointed out that “Almost a whole lot of Government employees appointed on or after 01-01-2004, were unhappy with New Pension Scheme. Govt. should take a call to look into their complaint”.

As per the recommendations of 7th CPC, Central Government appointed a Committee called “NPS Committee” for streamlining the functioning of NPS. The Staff-side has demanded before this Committee to scrap NPS and guarantee for 50% of the last pay drawn as minimum pension subject to a minimum of Rs.9000-. Even though, the Committee has submitted its report 18 months back, the Government has not yet disclosed the recommendations of the Committee.

Confederation and AISGEF has decided countrywide intensive campaign culminating in one day strike on 15th November 2018 demanding that the Defined Contributory Pension Scheme (New Pension Scheme – NPS) imposed on new entrants must be scrapped and the Government should reintroduce the Defined Benefit Pension Scheme (Old Pension Scheme – OPS) that was in vogue for a century or more. We are also exploring the possibility of organizing an indefinite strike in the coming days exclusively on one demand i.e., SCRAP NPS, RESTORE OPS for which wider consultations are being made with all like-minded organizations.

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e-mail: mkrishnan6854@gmail.com

Source: Confederation

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REINTRODUCTION OF OLD PENSION SCHEME

Reintroduction Of Old Pension Scheme

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF FINANCIAL SERVICES

LOK SABHA
UNSTARRED QUESTION NO. 4075
TO BE ANSWERED ON AUGUST 10, 2018/SHRAVANA 19, 1940 (SAKA)
REINTRODUCTION OF OLD PENSION SCHEME

Shri Rakesh Singh

Will the Minister of FINANCE be pleased to state

  • the details of drawbacks of the New Pension Scheme (NPS) introduced for the Government officials;
  • whether the NPS is not as beneficial monetarily as the Old Pension Scheme (OPS) and if so, the details thereof;
  •  whether the Government employees are disgruntled with the NPS and if so, the details thereof; and
  • whether the Government proposes to reintroduce the OPS replacing the NPS, if so, the details thereof and the action taken by the Government in this regard?

ANSWER

The Minister of State in the Ministry of Finance
(Shri Shiv Pratap Shulda)

(a) & (b) National Pension System (NPS) has been designed giving utmost importance to the welfare of the subscribers. Government has made a conscious move to shift from the defined benefit pension scheme to defined contribution pension scheme i.e. NPS, due to rising and unsustainable pension bill. There are a number of benefits available to the employees under NPS. Some of the benefits are enlisted below:

  • NPS is a well designed pension system managed through an unbundled architecture involving intermediaries appointed by the Pension Fund Regulatory and Development Authority (PFRDA) viz. pension funds, custodian, central record keeping and accounting agency, National Pension System Trust, trustee bank, points of presence and Annuity service providers. It is prudently regulated by PFRDA which is a statutory regulatory body established to promote old age income security and to protect the interest of subscribers of NPS.
  • The pension wealth which accumulates over a period of time till retirement grows with a compounding effect. The all-in-costs of the institutional architecture of NPS are among the lowest in the world.
  • Contribution made to the NPS Tier-I account is eligible for tax deduction under the Income Tax Act, 1961. An additional tax rebate of Rs.50000 is also allowed for contributions made to NPS Tier-I under Section 80CCD (1B) of the Income Tax Act, 1961.
  • Subscribers can withdraw up to 25% of their own contributions before attaining age of superannuation, subject to certain conditions. Further, PFRDA vide “PFRDA (Exits and Withdrawals under the NPS) (First Amendment) Regulations, 2017″ dated 10.08.2017 has liberalized norms for partial withdrawals which also include reduction of requirement of minimum years of being enrolled under NPS from 10 years to 3 years from the date of joining.
  • PFRDA has increased the maximum age limit from 60 years to 65 years for joining NPS-All Citizen Model and Corporate Sector Model, vide “PFRDA (Exits and Withdrawals under the NPS) (Second Amendment) Regulations, 2017” dated 06.10.2017.
  • PFRDA vide “PFRDA (Exits and Withdrawals under the NPS) (Third Amendment) Regulations, 2018″ dated 02.2018 has facilitated easy exit & withdrawal in case of disability and incapacitation of the subscriber covered under NPS.
  • Transparency and Portability is ensured through online access of the pension account by the NPS subscribers, across all geographical locations and portability of employments.

(c) & (d) Representations have been received which inter alia also include the demand that the Government may revert to old defined benefit pension system. However, due to rising and unsustainable pension bill and competing claims on the fiscal, there is no proposal to replace the NPS with old pension scheme in respect of Central Government employees recruited on or after 01.01.2004.

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