Bhagwant Mann Cabinet okays old pension scheme in Punjab, 1.75 lakh employees to benefit

Chandigarh, November 18

The Punjab Cabinet led by CM Bhagwant Mann today approved the reimplementation of the old pension scheme (OPS), which was discontinued in 2004. A notification has been issued.

A spokesperson for the Chief Minister’s Office said the decision would benefit more than 1.75 lakh government employees currently covered under the new pension scheme (NPS). In addition, 1.26 lakh employees are already covered under the existing OPS. The scheme is expected to benefit more than 4,100 employees in the next five years alone. In order to ensure that the scheme being introduced is financially sustainable for the exchequer, the state government will be contributing proactively to the pension corpus, the spokesperson said.

The contribution to the pension corpus will be Rs 1,000 crore per annum initially and will gradually increase. In addition to this, the current accumulated corpus with the NPS is Rs 16,746 crore, which the state government will request the Pension Fund Regulatory and Development Authority (PFRDA), a central body, to refund.

The Cabinet reiterated its firm commitment that the scheme would be made self-sustainable from the resources available with the exchequer.

Pension corpus

• The Rs 1,000-cr contribution per annum to pension corpus will be increased gradually
• In addition, the corpus with NPS is Rs 16,746 cr; the state will seek refund of this amount

1.75 lakh govt employees covered under NPS to benefit from decision

1.26 lakh employees already covered under OPS

4,100 employees to benefit in next 5 years

An uphill task

• It will be a difficult task for the state to switch over to OPS
• It is unlikely Pension Fund Regulatory and Development Authority will release the corpus of Rs 16,746 cr contributed by employees and govt since April 2004, when NPS was launched