‘Old Age Cannot Be Left to Market Uncertainty’: AIDEF Demands OPS from 8th Pay Commission
The federation has also cited various Supreme Court judgments in support of its contention that pension constitutes a form of deferred remuneration and provides social security in old age
The All India Defence Employees’ Federation (AIDEF) has urged the 8th Central Pay Commission to recommend withdrawal of the contributory National Pension System (NPS) and restore the defined and guaranteed pension under the CCS Pension Rules for Central Government employees recruited on or after January 1, 2004.
In its detailed submission to the 8th CPC, AIDEF argued that retirement security should not be dependent primarily on market-linked returns and that employees covered under NPS face considerable uncertainty over the adequacy of their post-retirement income.
The federation has placed the restoration of the Old Pension Scheme (OPS), along with minimum pay and the fitment factor, among its major demands before the Pay Commission.
According to AIDEF, the issue assumes greater significance amid rising inflation and the increasing cost of essential services, including food, housing, education, healthcare and transportation.
AIDEF questions market-linked retirement security
AIDEF General Secretary C. Srikumar, who submitted the federation’s detailed justification, has argued that NPS employees are exposed to market volatility and inflation because their retirement corpus depends on accumulated contributions and investment returns.
The federation contends that even an increase in the nominal value of a retirement corpus may not translate into adequate purchasing power after retirement if inflation remains high.
AIDEF has therefore urged the 8th CPC to assess retirement benefits in terms of the actual post-retirement income and standard of living that employees can maintain.
The federation has also cited various Supreme Court judgments in support of its contention that pension constitutes a form of deferred remuneration and provides social security in old age.
UPS also opposed
AIDEF has reiterated that it opposed the NPS from its introduction and subsequently opposed the Unified Pension Scheme (UPS) announced by the government.
The federation had stayed away from a meeting convened by Prime Minister Narendra Modi to announce the UPS. Srikumar, representing AIDEF in the Standing Committee of the National Council (JCM), reportedly submitted a separate note explaining the federation’s position and its demand for restoration of OPS.
AIDEF now says its opposition to UPS has been vindicated by what it describes as limited employee adoption of the scheme.
Minimum pay and fitment factor remain key demands
While restoration of OPS is a major demand, AIDEF has also supported the broader demand of Central Government employees concerning minimum pay and the fitment factor.
The Staff Side of the National Council (JCM), along with major federations representing Defence civilian employees, has submitted detailed representations on these issues to the 8th CPC.
AIDEF has urged the Commission to consider the economic pressures facing both serving employees and pensioners while examining pay and retirement benefits.
The federation has specifically called for all Central Government employees recruited on or after January 1, 2004, to be brought under the CCS Pension Rules, 1972, now governed by the 2021 rules, so that they receive a defined and non-contributory pension after retirement.
Its submission argues that old-age financial security for government employees should not be left solely to the uncertainty associated with market-linked retirement savings.
