EPS-NPS switch shelved as trade unions object


New Delhi: The labour ministry has shelved plans to allow provident fund subscribers to switch to the National Pension System following objections from trade unions and retirement funds body EPFO.

The ministry took the decision at a meeting with the Employees’ Provident Fund Organisation, a senior government official told ET. “The labour ministry has decided to shelve the plan for now…,” the official said.

Minutes of the meeting are yet to be issued, which will have to be approved by the secretary before the government’s stand becomes official. The government had in the Union Budget 2015-16 gave option to EPFO subscribers to opt for NPS.


The move triggered massive protests from trade unions.


Three years later, the labour ministry moved a draft amendment to the Employees’ Provident Funds and Miscellaneous Provisions Act on August 23, proposing to allow the EPFO subscribers to opt for NPS, instead of the Employees’ Pension Scheme (EPS).

Ten central trade unions boycotted a tripartite meeting called by the labour ministry recently to discuss the proposal, while the RSS-affiliated Bhartiya Mazdoor Sangh rejected the proposal outright, saying that NPS was not at par with EPS and there is no certainty on the rate of return.

EPFO had said that this amendment would require commensurate changes in the Provident Fund Regulatory and Development Authority (PFRDA) Act.

One of the key factors that has led to shelving of this proposal for the second time is that it entailed moving only the pension part to NPS, while sought to retain the provident fund contribution with EPFO. “It has to be the shift of entire kitty/contribution like in NPS for government employees and cannot be partially between NPS and EPFO,” the official said.

Source link

Articles You May Like

NFL star Michael Thomas is on a mission to teach financial literacy
Former ambassador warns expiration of key nuclear treaty with Russia would make the U.S. ‘worse off’
Stock futures tick lower to end record-setting week
FM Nirmala Sitharaman launches 'Union Budget Mobile App' at halwa ceremony
How to get your $600 stimulus check

Leave a Reply

Your email address will not be published.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