Pension review panel yet to reach conclusion, discussions on, says Finmin

The National Pension System (NPS) has been caught in political crosshairs in recent times.

The finance ministry on June 22 described as false a news report that claimed a certain percentage of pension being proposed by the government for the employees under the National Pension System (NPS).

Finance secretary TV Somanathan-led panel had not reached a conclusion and was still talking to stakeholders, the ministry tweeted.

“The Committee, set up under the chairmanship of the Finance Secretary in pursuance of an announcement made by the Union Finance Minister in the Lok Sabha in the last Budget Session, is at present in the midst of its deliberations and is in the process of consulting stakeholders. The Committee has not yet reached any conclusions whatsoever,” it tweeted.

The tweet also said that a report carried in some newspapers purporting to give details of a certain specific percentage of pension being proposed under NPS was false.

The government in April set up a panel to review the country's pension system. Finance Minister Nirmala Sitharaman had said the government would consider changes to the pension system, to be used by both the Centre and all state governments, to unify the different schemes running in the country.

The committee is chaired by Somanathan and the chairman of the Pension Fund Regulatory and Development Authority is also part of the panel.

The debate over the country's pension scheme, adopted in 2004, has been growing after some states, most of them ruled by opposition parties, decided to move back to the earlier system, also referred to as the old pension scheme, where the pension burden falls entirely on the government with no contribution from employees.

The old pension scheme is being seen as a risk to government finances, prompting the Centre to initiate a review. No timeline has been set for the panel to submit its report.

The NPS scheme has performed well with a significant expansion in the subscriber but it is yet to achieve its full potential as the awareness around the need for long-term retirement planning and a security net post-retirement remains low in India.