PFRDA NPS TRUST ORDER

RESOLUTION ON SCRAPPING OF NEW PENSION SCHEME

Resolution on scrapping of New Pension Scheme which is going to be presented on 9^th NFPE federal council is reproduced below.

RESOLUTION ON SCRAPPING OF NEW PENSION SCHEME

         This 9thFederal Council, while vehemently opposing the new pension scheme introduced from April2004, strongly urges for scrapping of the scheme. The argument advocated by the Government that the total outgo on account of payments for the existing central government employees has gone up from Rs. 5,206 Crores in 1993 / 94 to Rs. 22, 618 Crores in 2003 / 04 and there is need to switch over from defined benefit pension Scheme to defined contribution Scheme does not hold water. The value of money and the Indian currency in the global market, the rise in price index and the rise in the rate of inflation are not taken into account. As the cost of living steadily increases along with the fiscal standards, the increase shown in the payment of pensions is only theoretical. Further, it is argued that many countries are switching to the contributory scheme also is irrelevant. Because, so many western countries which are quite often quoted as models by the ruling elite are paying pension as a social security for its employees ranging from 40 per cent to even 55 percent of the last pay drawn.

           This Federal Council further notes with concern that the amount accumulated in the pension fund by contributions from the employees and the departments they are employed is proposed to be invested in the trade of the share market. It is everyone’s knowledge that the share market is a heartless giant and the gambling is known for its fluctuations, many of the slumps are deliberately orchestrated to suit the needs of the trade gamblers. The fate of the hard earned money of the employees will be at the mercy of these unscrupulous elements. This is highly unfair and unwarranted.

          The new pension scheme is against the interests of the employees for the following reason:-

         

                i)   It displaces the age-old scheme of social security

ii) The fund raised in the pension will be invested in private share market for which there is no security.

iii) The contributory pension scheme does not guarantee the equal share as that of the employee by the Govt.

     

            Hence, this 9thFederal Council of NFPE held at Hyderabad from 09.06.2013 to 12.06.2013 strongly feels that this anti-employee new pension scheme may be scrapped once and for all. It further unanimously resolves to urge the UPA Govt. to drop the proposal and to restore the original defined Benefit Pension Scheme.