• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Home
  • DOPT ORDERS 2020
  • FinMin Orders 2020
  • Railway Orders 2020
  • Contact Us

7th Pay Commission Latest news

Central Government Employees News

  • DOPPW Orders
  • 7th Pay Commission
  • Dearness Allowance
  • Dearness Relief
  • CSD Price List
  • Defence
    • Defence Pension
You are here: Home / National Pension System / NPS : Equity Savings Cap on Pension of Govt Staff Might Be Raised

NPS : Equity Savings Cap on Pension of Govt Staff Might Be Raised

April 4, 2016 pcadmin Leave a Comment

NPS :ย Equity Savings Cap on Pension of Govt Staff Might Be Raised

PFRDA likely to make it 50% and allow employees to pick private fund managers

Government employees might soon be given a choice to invest as much as half their contribution towards pension funds in the stock market, against 15 per cent allowed now. These employees are also likely to get an option to select fund managers from private entities, against the current norm of only public sector fund managers.

The Pension Fund Regulatory and Development Authority (PFRDA) will invite stakeholders’ comments on the proposal in a month’s time, after which bids will be called for fund managers based on ‘significantly flexible regulations’.

“A lot of changes are going to be made in terms of choices we make available to the government employees over the choice of the investment pattern and fund manager. We are on the verge of finalising it,” said Hemant Contractor, chairman of PFRDA.

Contractor added the idea is to give government employees an option to invest up to 50 per cent in equities.

PFRDA will invite bids to appoint pension fund managers to manage the Rs 1 lakh-crore corpus under the National Pension Scheme (NPS).

“Our document is ready. We’ll put it up for stakeholders’ comments in a month’s time on this. Investment in equities gives better returns in the long run. We are hopeful it will be approved by the government,” said Contractor.

Of the Rs 1 lakh-crore assets under management of NPS, 90 per cent of that falls under the central and state government scheme.

NPS was made available to all citizens from 2009 onwards on a voluntary basis. But, all the central government employees joining the service from January 1, 2004 had to opt for NPS.

The proposal to allow private fund managers to manage state funds will allow government employees to opt for private fund managers.

The fund managers will likely be appointed for a five-year term instead of three years at present. The move is aimed at providing confidence to pension fund managers to take long-term investment decisions, which could bring in greater returns to subscribers.

Although fund managers for private sector employees are allowed to invest up to 50 per cent corpus in stocks, they usually invest only 17-18 per cent in equities. On the other hand, government fund managers who have a ceiling of 15 per cent, invest 10 per cent in equities.

The proposal will give confidence to pension fund managers to develop their own business model and decide on the investment they need to put in staffing and infrastructure. Besides, subscribers will feel confident that the manager handling their fund will not get de-registered in three years.

Currently, eight pension fund managers manage private-sector funds, while three run by state-owned financial institutions are allowed to manage central and state government funds.

The SBI Pension Funds Pvt Ltd, UTI Retirement Solutions Ltd, and LIC Pension Fund Ltd manage the government corpus. They also manage the private-sector corpus along with ICICI Prudential Pension Fund Management Co Ltd, Kotak Mahindra Pension Fund Ltd, HDFC Pension Management Co Ltd, Reliance Capital Pension Fund Ltd and the pension fund incorporated by Birla Sun Life Insurance Co Ltd.

The latest round of bids could see more pension fund managers coming on board. PFRDA is considering a common uniform request for proposal for both the government and the private sector.

For the past five years, while the Employees’ Provident Fund Organisation has been giving a return of 8.25-9.5 per cent to its subscribers, NPS has given a return of 9.2 per cent and NPS Lite has given a compound annual growth return of 9.68 per cent. However, NPS is taxed at the withdrawal stage, while Employees’ Provident Fund (EPF) is not.

In a bid to bring NPS on par with EPF, the government had announced taxation for both the funds, but rolled back the one for EPF following backlash from employees.

The Seventh Pay Commission, headed by A K Mathur, recommended ‘exempt exempt exempt’ (EEE) status for NPS as well, arguing NPS should be on a par with the EPF scheme in terms of tax-free withdrawal to provide a level-playing field. EEE status means the subscriber would not be taxed at the time of contribution, accretion and withdrawal from the fund.

Source : Business-Standard

Filed Under: National Pension System, PFRDA

Also Read

Union Budget 2023 : Live Updates

Union Budget 2023 : Live Updates

February 1, 2023 By pcadmin Leave a Comment

Union Budget 2023 : Live Updates ๐“๐ก๐ข๐ฌ ๐ข๐ฌ ๐ญ๐ก๐ž ๐Ÿ๐ข๐ซ๐ฌ๐ญ ๐›๐ฎ๐๐ ๐ž๐ญ ๐ข๐ง ๐€๐ฆ๐ซ๐ข๐ญ ๐Š๐š๐š๐ฅ. Budget focuses on 7 priorities, โ€˜saptrishi guiding us through Amrit Kaalโ€™ This budget hopes to build on the foundation laid in the previous budget and the blueprint drawn at India at 100. … [Read More...] about Union Budget 2023 : Live Updates

AICPIN for the month of December 2022

AICPIN for the month of December 2022

February 1, 2023 By pcadmin Leave a Comment

AICPIN for the month of December 2022 Consumer Price Index for Industrial Workers for December, 2022 The Labour Bureau, an attached office of the Ministry of Labour & Employment, has been compiling Consumer Price Index for Industrial Workers every month on the basis of retail prices … [Read More...] about AICPIN for the month of December 2022

One Rank One Pension to the Defence Forces Pensioners. orop

One Rank One Pension to the Defence Forces Pensioners.

January 24, 2023 By pcadmin Leave a Comment

One Rank One Pension to the Defence Forces Pensioners. No. 1(1)/2019/D(Pen/Pol)/Vol-IIGovernment of IndiaMinistry of DefenceDepartment of Ex-Servicemen Welfare New Delhi, Dated: 20th January 2023 ToThe Chief of the Defence StaffThe Chief of the Army StaffThe Chief of the Naval StaffThe … [Read More...] about One Rank One Pension to the Defence Forces Pensioners.

Addendum for early closure of all the offices falling in the premises of Parliament House & Rashtrapati Bhawan in c/w forthcoming Republic Day

Addendum for early closure of all the offices falling in the premises of Parliament House & Rashtrapati Bhawan in c/w forthcoming Republic Day

January 23, 2023 By pcadmin Leave a Comment

Addendum for early closure of all the offices falling in the premises of Parliament House & Rashtrapati Bhawan in c/w forthcoming Republic Day No.16/3/2023-JCAGovernment of IndiaMinistry of Personnel Public Grievances and Pensions(Department of Personnel and Training)Establishment (JCA) … [Read More...] about Addendum for early closure of all the offices falling in the premises of Parliament House & Rashtrapati Bhawan in c/w forthcoming Republic Day

Linking of CGHS Beneficiary ID with the ABHA ID

Linking of CGHS Beneficiary ID with the ABHA ID

January 20, 2023 By pcadmin Leave a Comment

Linking of CGHS Beneficiary ID with the ABHA ID F.No. 44/67/MCTC/CGHSGovernment of IndiaMinistry of Health & Family WelfareDepartment of Health & Family Welfare Nirman Bhawan, New DelhiDated the January, 2023 OFFICE MEMORANDUM SUBJECT: Linking of CGHS Beneficiary ID with the ABHA … [Read More...] about Linking of CGHS Beneficiary ID with the ABHA ID

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

All About Pension

All about Pension

Latest DOPT Orders

Addendum for early closure of all the offices falling in the premises of Parliament House & Rashtrapati Bhawan in c/w forthcoming Republic Day

Early Closure of Offices in connection with Republic Day Parade/Beating Retreat Ceremony/At Home Function during January, 2023

Review of CSS Officers (Under Secretary) under FR 56(j) and Rule 48 of CCS (Pension) Rules, 1972

Year-End- Review of DoPT(Ministry of Personnel, Public Grievances & Pensions)-2022

Extension of the LTC block year 2018-21 (extended) for a period of three months

Latest Finmin Orders

Compendium of Instructions regarding grant of House Rent Allowance to Central Government employees – FINMIN

CGEGIS 1980: Table of Benefits of saving funds from Oct to Dec 2022

Non-Productivity Linked Bonus (ad-hoc bonus) to Central Government Employees for 2021-22

FINMIN : Dearness Allowance to Central Government employees effective from 01.07.2022.

Compendium of Instructions regarding grant of Transport Allowance at double the normal rates to persons with disabilities employed in Central Government

Latest Railway Orders

Implementation of Railway Services (Revised Pay) Rules, 2016

Computer Advance Interest Rate 2022-23 for Railway Employees

Eligibility of married disabled child for family pension โ€“ Railway Board order

Grant of Leave to Probationary officers: Railway Board

Productivity Linked Bonus to all eligible non-gazetted Railway employees for 2020-2021

Categories

Copyright © 2023