Now Reading: No Old Pension Scheme restoration, Centre tells Lok Sabha
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No Old Pension Scheme restoration, Centre tells Lok Sabha
The Modi government has firmly ruled out restoring the Old Pension Scheme (OPS), calling its fiscal liability unsustainable. Minister of State for Finance Pankaj Chaudhary told the Lok Sabha on Monday that…
The Story in Brief
The Modi government has firmly ruled out restoring the Old Pension Scheme (OPS), calling its fiscal liability unsustainable. Minister of State for Finance Pankaj Chaudhary told the Lok Sabha on Monday that no proposal is under consideration, citing a potential burden on the exchequer. Five states, Rajasthan, Chhattisgarh, Jharkhand, Punjab and Himachal Pradesh, have told the Centre and PFRDA they intend to revert from the National Pension System (NPS) to OPS.
However, Chaudhary said no legal mechanism exists under the PFRDA Act to refund the accumulated NPS corpus, employee and government contributions plus accruals, back to state governments. The Centre instead touts the Unified Pension Scheme (UPS), launched April 1, 2025, which guarantees a minimum Rs 10,000 monthly pension under NPS. The government's fiscal deficit has narrowed from 6.7% of GDP in 2021-22 to 4.4% in 2025-26.
The Indian Opinion
Political parties campaign on OPS revival but skip the hard arithmetic: the unfunded liability would blow a hole in State finances, as CAG reports on Rajasthan and Punjab already show. The five States that reverted are sitting on a legal tangle, PFRDA rules have no exit clause to refund the Rs 3.65 lakh crore NPS corpus to governments. The test is simple: will Himachal or Chhattisgarh match the arrears their employees lost when they switched, or pass the cost to future taxpayers?
Source: livemint.com
This story was synthesised by AI from the source linked above.
