Old Pension Scheme: Some states still use the outdated pension system. The Center has received this information directly from the state governments.
Old Pension Plan in the States The country has been in uproar about the old pension and new pension systems (Old and New Pension Scheme). Regarding its execution, the federal government and state governments have frequently clashed. Although it was raised as a significant issue during several states’ assembly elections, some governments have recently adopted the outdated pension plan. The Modi administration has notified the House that the state legislatures have been informed about the execution of the previous pension program in five of the nation’s states. Know the most recent update..(ads1)
Old pension applicable in these states
Bhagwat Karad, the minister of state for finance, said the Lok Sabha on Monday that the governments of five states—Rajasthan, Chhattisgarh, Jharkhand, Punjab, and Himachal Pradesh—had already adopted the old pension plan. It has informed the federal government of its decision to re-implement. He said that the decision will only temporarily save money on taxes, as stated in the RBI study “State Finances: A Study of Budget of 2022–23.” In the upcoming years, these states might face underfunded pension liabilities.
Information given to Pension Fund Regulatory
The state governments of Rajasthan, Chhattisgarh, Jharkhand, Punjab, and Himachal Pradesh have chosen to restore the old pension plan (OPS) for their state government employees, according to Bhagwat Karad’s response to a written question in the Parliament. The Central Government has received information about this. The Pension Fund Regulatory and Development Authority (PFRDA) has also been informed in conjunction with this.
RBI had told the risk
In a previous assessment on the old pension plan, the RBI had stated that individuals who were discussing adopting the old pension system in the state. As a result, the states’ budgetary situation is at significant jeopardy. The paper claims that by deferring present costs to the future, the governments may incur responsibilities in the years to come for which they lack the financial infrastructure. On the other hand, under the previous pension plan, employees received a pension equal to 50% of their final take-home pay. the sum that the government provided.
