Wednesday 8 February 2023

Five State Govt. reverted from NPS to OPS

 Five State Govt. reverted from NPS to OPS

The finance ministry on Monday said governments of five states -- Rajasthan, Chhattisgarh, Jharkhand, Punjab, and Himachal Pradesh -- have informed the Centre about their decision to revert to the old pension scheme.

In a written reply to a question in the Lok Sabha, minister of state for finance Bhagwat Karad said as per RBI's report titled 'State Finances: A Study of Budget of 2022-23', the annual saving in fiscal resources that reversion to the old pension scheme entails is short-lived. West Bengal did not join the NPS till now.

By postponing the current expenses to the future, states risk the accumulation of unfunded pension liabilities in the coming years.

Employees associations have been demanding scrapping of NPS and reverting to Old Pension Scheme since long. Old Pension Scheme is a Defined Benefit Pension System where pension is determined on last pay of the employee where NPS. In the other hand, NPS is basically a system where employee and employer both contributes to build a corpus, which will take care of the pension by form of annuity


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