Old Pension Scheme: Government employees retiring under OPS used to get 50 percent of their last drawn pay as monthly pension. This amount keeps increasing with the increase in the rates of dearness allowance. NPS has been made applicable to all government employees except Armed Forces employees joining the Central Government after January, 2004.
Pension Scheme in India: The committee constituted to review the existing pension system ‘NPS’ for government employees is currently in the process of consultation with the stakeholders and its report has not been finalized yet. The Finance Ministry had constituted the committee in April under the chairmanship of Finance Secretary TV Somanathan to review the pension scheme for government employees and suggest necessary changes in the existing design and structure of the National Pension System (NPS).
Finance Ministry
Now the ministry said in a tweet, “The Somanathan Committee is in the process of consultation with the relevant stakeholders and has not yet arrived at any conclusion.” As per the terms of formation, this committee will be constituted for government employees covered under NPS. Will suggest the measures needed to improve the pension benefits of the These suggestions will be given keeping in mind the fiscal impact and impact on overall budgetary provisions so that fiscal strength is maintained.
Old Pension Scheme
The committee, headed by the Finance Secretary, includes Secretary, Department of Personnel and Training, Special Secretary, Department of Expenditure and Chairman, Pension Fund Regulatory and Development Authority (PFRDA) as members. In the last few months, many state governments ruled by the opposition have decided to implement the ‘Old Pension Scheme’ (OPS). Enthused by this, employee organizations in some other states have also raised their demand.
Ops
The State Governments of Rajasthan, Chhattisgarh, Jharkhand, Punjab and Himachal Pradesh have informed the Central Government about their decision to implement OPS and have requested it to return the amount deposited under NPS. As far as the demand for implementation of OPS at the Central Government level is concerned, the Finance Ministry has completely denied this possibility. It was informed by the Ministry in Parliament that no proposal is under consideration to implement OPS in respect of Central Government employees recruited after January 1, 2004.
Pension
Government employees retiring under OPS were entitled to 50 per cent of their last drawn pay as monthly pension. This amount keeps increasing with the increase in the rates of dearness allowance. NPS has been made applicable to all government employees except Armed Forces employees joining the Central Government after January, 2004. Most of the state and union territory governments have also adopted NPS as a pension system for their new employees.
