In the OPS, upon retirement, employees receive 50 percent of their last drawn basic pay plus dearness allowance or their average earnings in the last ten months of service, whichever is more advantageous to them. A ten-year service requirement should be met by the employee.
Under OPS, employees are not required to contribute to their pensions.In this NPS, those employed by the government contribute 10 percent of their basic salary to NPS, while their employers contribute up to 14 percent. The money is then invested by the government in safe funds. A professional pension fund manager can ensure that superior returns and a larger retirement corpus are achieved, regardless of equity or debt.Video Courtesy: The PrintStates like Rajasthan, Chhattisgarh, and Jharkhand have already implemented the old pension scheme.u201cIt is up to the states to take a call on whether they want to continue with the national pension system (NPS) or go back to their old scheme. But they should think about financial viability vis-a-vis the benefits of pension holders,u201d said Chairman of Pension Fund Regulatory and Development Authority (PFRDA) Supratim Bandyopadhyay on Friday. Expected results of implementing OPS will be felt from 2035 onwards when the present government employees retire and the overall population dependency ratio increases from16% at present to 23% due to longevity and slowing down of population growth.The thing to note is Atal Bihari Vajpayee’s government bring NPS because government expenses were, in large amounts, spent on pensions. And when the population dependency ratio is going to increase it is obvious that government expenses will increase exponentially which could be a disaster for the state economy.
