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Tuesday, March 21, 2023
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
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.
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 :
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.
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
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.
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. •
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.
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.
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
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
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.
REPORT OF THE COMPTROLLER AND AUDITOR
GENERAL OF INDIA (C&AG) DATED 4th AUGUST
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.
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
main demand of restoration of Old Pension scheme instead of Present NPS scheme or
Minimum Assured Return Scheme (MARS) to the NPS subscribers.
Please circulate amongst all the NPS holders.
in Dharna / Rally programs , don’t be whatsapp heroes, struggle path only fetch
you pension .
Issued by COC Karnataka in the interest of NPS
Thursday, March 2, 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 %