NEW DELHI: After a campaign for assured pension , there is only a small proportion of central govt employees who have opted for the Unified Pension Scheme , offering assured 50 per cent pension, with several seeking further clarifications to exercise the one-time option.
As a result, govt has extended the June-end deadline by three months. Employees want to be absolutely sure about the terms of the agreement before deciding to switch to UPS.
A concern for employees who joined national pension system from 2004 is the lack of clarity on death benefits. While an assurance was given last week, there are still a few issues that are to be resolved.
Under the UPS, while an employee will contribute 10 per cent of his or her salary towards pension, a matching contribution will be made by the Centre, which was 14 per cent under NPS. Under the new scheme, apart from the 10 per cent pension payment, another 8.5 per cent contribution is to be made by the Centre which will not reflect in the balance of the subscriber’s account. While most employees understand the change, there are some who believe that the payout may be lower.
Further, some of the all India service officers want to know about the difference in contribution between the Centre and states, which don’t have a scheme yet. An IAS, IPS or Indian Forest Service officer spends time in the state with some of them also opting for central deputation. While the rules are quite clear, some of the officers have raised doubts.
Meanwhile, fund managers, who have been asked to conduct outreach programmes, are smelling a rat and allege that some private players are sowing doubts as they stand to lose out on the annuity business under UPS.
Employees now have time to exercise the switching option up to the end of September. The option can be exercised by 23 lakh government employees.
As a result, govt has extended the June-end deadline by three months. Employees want to be absolutely sure about the terms of the agreement before deciding to switch to UPS.
A concern for employees who joined national pension system from 2004 is the lack of clarity on death benefits. While an assurance was given last week, there are still a few issues that are to be resolved.
Under the UPS, while an employee will contribute 10 per cent of his or her salary towards pension, a matching contribution will be made by the Centre, which was 14 per cent under NPS. Under the new scheme, apart from the 10 per cent pension payment, another 8.5 per cent contribution is to be made by the Centre which will not reflect in the balance of the subscriber’s account. While most employees understand the change, there are some who believe that the payout may be lower.
Further, some of the all India service officers want to know about the difference in contribution between the Centre and states, which don’t have a scheme yet. An IAS, IPS or Indian Forest Service officer spends time in the state with some of them also opting for central deputation. While the rules are quite clear, some of the officers have raised doubts.
Meanwhile, fund managers, who have been asked to conduct outreach programmes, are smelling a rat and allege that some private players are sowing doubts as they stand to lose out on the annuity business under UPS.
Employees now have time to exercise the switching option up to the end of September. The option can be exercised by 23 lakh government employees.
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