Finance Minister Palanivel Thiaga Rajan on Saturday cited the case of Rajasthan to explain issues involved in the restoration of the old pension scheme (the defined benefit pension scheme).
Making his reply to the debate in the Assembly on the demands for grants for his department, he said the Pension Fund Regulatory and Development Authority (PFRDA) was reported to have rejected the Rajasthan government’s request to withdraw funds accrued under the National Pension Scheme (NPS) for the implementation of the old pension scheme.
Pointing out that the State government and employees would contribute 10% each under the Contributory Pension Scheme, he said the contributions were getting credited to the individual accounts of the beneficiaries and the law did not permit them to be transferred to the government.
He observed that Tamil Nadu and West Bengal were the States that did not join the NPS (for the purpose of investing funds).
Earlier, while initiating the debate, the Minister said the “steep increase” in pension cost for 2022-23, which stood at ₹39,508.37 crore, was due to the rise in the retirement age of government employees from 58 years to 59 years in 2020 and to 60 years in 2021.
At present, there were 3,14,945 employees who were covered under the old pension scheme, apart from 7,15,761 pensioners and family pensioners. Those employees, recruited on or after April 1, 2003, were being enrolled under the Contributory Pension Scheme, and they numbered 6,02,377.
