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Tuesday, March 21, 2023

NPS employees dharna program at Mysore


NPS employees Rally and Meeting held on 21st March 2023 at Bengaluru

 Under the banner of  Joint Forum of Restoration of Old Pension Scheme  a rally and meeting was organized in the premises of City Railway station opposite to City RMS office Bengaluru. In which thousands of employees participated in it.


Friday, March 17, 2023

A Paper on NPS issues


National Pension System (NPS)

Now this NPS scheme has about 625 lakhs NPS subscribers as on March 2023 with accumulated wealth of about 8.8 lakh crores in the share market which includes about 40 lakhs  Central Government  employees , several state government employees etc. Today in Government departments about 60 to 70 percentage of employees are from NPS category .  Hence it is an important demand of  Government  employees and  we should address it. 


The main demand of NPS employees today is the implementation of Old pension Scheme to the NPS subscribers. Is the important demand of NPS employees? Let us study about this scheme and our demands fulfilled and demands not resolved yet how can we achieve this demand. The actual impact of this scheme will be felt after 2025 when the retirement process starts , the full impact of NPS scheme will be felt in 2034 onwards . However the impact of NPS scheme is already being observed for  GDS employees.


History and Scheme Details:

  A New Pension Scheme (Contribution based Pension Scheme) now called National Pension System (NPS), was introduced  By NDA Government for Central Government employees vide Ministry of Finance (Department of Economic Affairs) Notification No. 5/7/2003- ECB & PR dated 22nd December, 2003. NPS was made mandatory for all new recruits to the Central Government service (except the armed forces) from 1st January, 2004. After the enactment of the PFRDA Act, 2013, as per Section 20 of the Act, the pension scheme notified on 22.12.2003 has become the National Pension System under the Act. NPS is now regulated under PFRDA Act, 2013 and regulation framed thereunder by Department of Financial Services and PFRDA With the introduction of NPS w.e.f. 01.01.2004.

Later on many State Governments have adopted this scheme at different stages . expect Kerala and West Bengal State Governments.  This NPS scheme is also applied to Bank & LIC employees also.  Hence a united fight against this NPS scheme by all.

How this NPS scheme works after retirement:

On exit from NPS on superannuation, an individual is mandatorily required to invest at least 40% of the accumulated pension corpus in Tier-I to purchase an annuity from an Annuity Service Provider an Insurance Regulatory and Development Authority (IRDA) regulated Insurance Company registered with PFRDA and a maximum of 60% of the accumulated corpus in the Tier –I account is given to the individual in lump- 4  sum. If the Government servant exits from NPS before superannuation (i.e. before 60 years of age), he/ she has to invest at least 80% of the accumulated corpus to purchase an annuity and the remaining 20% can be withdrawn as lump sum. • Department of Financial Services notification dated 31.01.2019 – In implementation of the recommendations of the committee constituted for suggesting measures for streamlining implementation of NPS, Department of Financial Services vide their notification dated 31.01.2019 extended following benefits to Government employees covered under NPS: (i) Employee contribution 10% of the salary and DA with matching contribution @ 14% by the Government w.e.f. 01.04.2019. (ii) Investment of NPS wealth upto 95% in infrastructure/Debt funds and 5-15% in equity for Government employees. Life Cycle based funds viz. LC-50 and LC-25 also available w.e.f. 01.04.2019. (iii) Option for investment choices and Pension Fund made available to Government servants w.e.f. 01.04.2019.

    Under the NPS, every Government servant is registered and allotted a Permanent Retirement Account Number (PRAN). Before 1.4.2019, a Government employee had to mandatorily contribute 10% of pay and Dearness Allowance (DA) and an equal amount of 10% was contributed by the Government to the employee’s pension fund. Now 14% • The contribution made by the employees and contribution from the Government were invested by Pension Fund Managers in accordance with the investment pattern prescribed by the PFRDA for Central Government employees. There were three PSU Pension Fund Managers for Government employees. Government employees had no choice for Pension Fund Managers or investment pattern. •

Improvement in NPS scheme after our struggles :

1)      Benefit of retirement gratuity and death gratuity: Department of Pension and Pensioners’ Welfare O.M. No. 7/5/2012- P&PW(F/B) dated 26.08.2016- The benefit of retirement gratuity and death gratuity have been extended to the Central Government employees covered under NPS vide DoPPW O.M. dated 26.08.2016 on the same terms and conditions as are applicable under CCS(Pension) Rules, 1972.


2)      Counting of service :   Instructions were issued by DoPPW vide OM dated 26.07.2005 for counting of past service rendered in a Government service or service of an autonomous body having CCS(Pension) Rules and appointed on or before 31.12.2003


3)      Instructions have been issued vide DoPPW OM dated 01.01.2021 that if a Government employee appointed on or after 01.01.2004 and covered under NPS is disabled, he shall also be eligible to receive a lump sum compensation computed in terms of rule 9(3) of CCS(Extraordinary Pension) Rules, if the disablement is attributable to Government service and the Government employee is retained in service in spite of such disablement.


4)      DoPPW OM No. 57/4/2019-P&PW(B) dated 17.02.2020 - An OM dated 17.02.2020 has been issued by Department of Pension and Pensioners’ Welfare providing that in all cases where the results for recruitment were  declared before 01.01.2004 against vacancies occurring on or before 31.12.2003, the candidates declared successful for recruitment shall be eligible for coverage under the Central Civil Services (Pension) Rules, 1972. Accordingly, such Government servants who were declared successful for recruitment in the results declared on or before 31.12.2003 against vacancies occurring before 01.01.2004 and covered under the National Pension System on joining service on or after 01.01.2004, may be given a one-time option to be covered under the Central Civil Services (Pension) Rules, 1972. •


5)      Extending benefit of CGHS to Government employees covered under NPS Initiatives by Ministry of Health and Family Welfare • Ministry of Health and Family Welfare OM No. S.11011/10/2012-CGHS (P)/EHS dated 28.03.2017 – Ministry of Health and Family Welfare issues instruction on extending benefit of CGHS to Government employees covered under NPS, subject to conditions that: i. Minimum years of qualifying service for eligibility of CGHS membership after retirement- 10 years. ii. No minimum qualifying years of service for availing CGHS facilities in case of. Death / disability. iii. Other conditions such as definition of family, CGHS contributions, conditions of dependency etc will be applicable as per existing rules.


6)      Government contribution has increased to 14% : Government employee had to mandatorily contribute 10% of pay and Dearness Allowance (DA) and  from  1/4/2019  the government contribution has increased to  14%  from 10%  was contributed by the Government to the employee’s pension fund. Vide Office Memorandum dated 31st Jan 2019. Issued by Finance Ministry. This results in higher pension than before.


7)      Investment in NPS Tier II has been brought under Section 80 C for tax exemption w.e.f. 01.04.2019. and Rs 50,000/ under section 80CCD (1B) and Lump sum withdrawal for specified reasons upto 25 % is allowed now and tax exemption under Section 10(12B) of the IT act 1961. On Employee’s contribution: Employee’s own contribution is eligible for tax deduction under sec 80 CCD (1) of Income Tax Act up to 10% of salary (Basic + DA). This is within the overall ceiling of Rs. 1.50 Lakhs under Sec. 80 CCE of the Income Tax Act. (ii) On Employer’s contribution: Up to 10% of Basic & DA (no monetary ceiling) under 80CCD (2). This rebate is over and above 80 CCE limits of Rs 1.50 lakhs


8)      The Government has notified CCS(Pension) 2021 in August 2021.

Now our further struggles on this issue of restoration of OPS:

 The employees should get guaranteed minimum pension,  Since it is a contributory  pension unlike the OPS scheme where the employees contribution is not there , here in this NPS scheme the employees contribute 10% of their Basic pay  plus DA .The Government contribution is about 14% of basic pay together about 24% amount  hence we should get more pension amount than the OPS.  

 As on today we are getting in the New Pension scheme today the returns we are getting is about 2 % to 8% depending upon the share market on an average of 4 % returns. If we invest in fixed deposits we get about 8% annual returns without any risks , but we deposit our hard earned money into the share market we are bound to take the share market risk , the share market is volatile market not only dependent on Indian conditions and also foreign markets .   Investment of contribution in NPS  scheme (it is estimated that Government securities give real returns of 1.6% per annum, corporate bonds give real rate of returns of 5% per annum and Equity give a real rate of returns of 8% Per annum over a long period).

Today our employees after serving government for many years are only given paltry pension from Rs 2000 to Rs 15,000/ per month depending upon length of service, compared to Rs 20,000/ for an MTS in old pension scheme .

Our challenges are that in India we have about 625 lakhs NPS subscribers as on March 2023 with accumulated wealth of about 8.8 lakh crores in the share market. With state government employees alone contributing about 4.4 lakhs crores.  It is not that easy to convince the central government to withdraw Rs 8.8 lakhs crores from share market investment without proper struggle.  The central government always maintained there is no provision in the PFRDA Act for a refund of the accumulated NPS corpus . The Rajasthan state Government order on Old Pension scheme restoration clearly indicates that the date of effect is from 1/4/2022. The Central Governments and State governments should ensure   a proper minimum pension is provided to the employees after retirement.    

The PFRDA has published   an article for Minimum Assured Return Scheme (MARS) to the NPS subscribers under section 20 2 (b) should be provided.



Audit noticed that PFRDA initiated (February 2019), the process to design the Minimum Assured Returns Scheme (MARS) by issuing an Expression of Interest for design and development of MARS under NPS.

 C & AG report (Para 3.7) recommends for providing Minimum Assured Return Scheme (MARS) to the NPS subscribers.


C & AG report (Para 3.8) quotes the strike notice of Confederation of Central Government Employees & Workers served to the Central Government demanding 50% of the last pay drawn as Minimum Pension and the reply of the Government.


The Pension Fund Regulatory and Development Authority is expected to launch its first minimum assured return scheme (MARS) under the National Pension System (NPS) this year. There are very few products like this currently in India or abroad.  But returns should be minimum of 8.33% then only we can expect good amount pension, the PFRDA is working out at  3% to 5% returns which is very less. So we should demand minimum pension as per Old Pension Scheme.    


  Even after lapse of nearly 20 years since the introduction of the NPS, the subscribers were not yet to receive such minimum assurance.  Immediate steps need to be taken for providing MARS in compliance to the provisions of the PFRDA Act, to the subscriber for ensuring their social security post retirement.

The Governments all along are informing public that there is huge expenditure on the pension portion , the actual figures works out to just around 8% of the total revenue  receipts spent on the pensions which is a welfare measure as the government is a model employer .

Education of all the NPS employees and bringing them on the path of struggle is very important to get the minimum pension scheme for the NPS employees. If we put more pressure on the Government through our struggles we can achieve the desired results, as we have achieved improvements in NPS scheme we can achieve this also our main demand of minimum pension scheme. Due to our struggles a few state governments  like Himachal Pradesh , Rajasthan , Chhattisgarh  have withdrawn from NPS scheme and provided its employees the Old Pension Scheme , a few state governments like Kerala and West Bengal from the beginning newer adopted this NPS scheme . Many other state governments have constituted committees to study reverting back to old pension scheme such as Karnataka & Maharashtra.  

Hence we should take the fight to the governments by participating in movements such as dharna , rallies etc. So that the pressure is built on governments to invest our hard earned money into government schemes including SBI and LIC pension funds where we get 12 % returns on the investment made by us instead of share market which is volatile and not recommended for government employees. Today after the study we made the mutual funds are only providing us between 4 to 8% returns only. It is not the matter where the government invest our money it is matter how much returns we get on our contribution and Government contributions, we NPS employees should get more than the Old Pension Scheme employees as we are contribution is there The .   

Hence our main demand of restoration of Old Pension scheme instead of Present NPS scheme or providing Minimum Assured Return Scheme (MARS) to the NPS subscribers.


Please circulate amongst all the NPS holders.

Participate in Dharna / Rally programs , don’t be whatsapp heroes, struggle path only fetch you pension .

Issued by COC Karnataka in the interest of NPS employees.                                                                                                                         










Thursday, March 2, 2023

All India CPI & DA Jan 2023

 The All-India CPI-IW for January, 2023 increased by 0.5 points and stood at 132.8 (one hundred thirty two point eight). This increase in CPI-IW is opening the account of Expected DA/DR from July, 2023 i.r.o. Central Govt Employees and Pensioners with score of 1% increase in 1st month.  Rest of 5 months’ CPI-IW index will confirm the exact figure of DA/DR of Jul, 2023.

DA as on 1st Feb 2023 is 43.08 %