National Pension Scheme: Central Government can come up with good news for pensioners till the end of this year. As per a report by Live mint, amending the NPS, the Government is in deliberation to give at least 40-45 percent of the salary to the pensioners. It is expected that Government will further amend the scheme after getting recommendations from a high-level panel. If the reports are true, almost 8.7 million Central and State Government employees will benefit from the scheme.
As per the report, the Government can make some major changes to the National Pension Scheme to offer much higher returns to the pensioners. Authorities can also make changes in the share of contribution given by the employees and the employer, which is either the Central Government or State Government in this case.
Recently, the pension scheme is political issue in the country as many states where opposition parties are ruling are not considering the new and updated NPS scheme and implementing the older version of the scheme which includes states like Chhattisgarh, Jharkhand, Rajasthan, Himachal Pradesh and Punjab. As per experts, the continued implementation of older NPS scheme can take these state governments into the state of bankruptcy.
After introducing the new NPS scheme, the Central Government is facing criticism for the contribution made by the employees as it was not part of the earlier version of the scheme.
In the older version of the scheme, the government used to contribute the entire amount. But in the new amended version, the employee is said to make 10 percent contribution whereas the government contributes 14 percent. The new updated NPS enables pensioners to get 60 percent of the corpus tax-free when they retire and offers to buy annuity of remaining 40 percent on which the tax cut is applicable.
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