A National Convention on scrap NPS and Restore Old Pension Scheme was held at New Delhi under the banner of Joint Forum for Restoration of Old Pension Scheme (NJCA) on 21/01/2023. Shiva Gopal Mishra, Convener of the NJCA moved a declaration drafted by the steering committee of JFROPS (NJCA) which was seconded by M. Raghavaiah, Co-Convener. The declaration was supported and endorsed by S.N. Pathak, President of AIDEF and C. Srikumar, General Secretary, of AIDEF.
The declaration was also supported and endorsed by the Leaders of Central Government employees, State Government Employees, Teachers Organizations, and Power Engineers and also of Autonomous Bodies. Leaders representing the State Government employees and Teachers of Jammu and Kashmir also participated and endorsed the declaration the declaration has proposed 6 months action programmes to be observed by the Trade Unions of Central & State Government Employees.
A massive Rally of lacs of Central & State Government employees will be organized during the Monsoon session of the Parliament during July and August 2023 in that Rally a serious Trade Union Action including strike is expected to be decided. The declaration adopted in the Convention is published here for the benefit of the viewers of www.indianpsu.com –
Declaration on “SCRAP NPS” and “RESTORE THE DEFINED OLD PENSION SCHEME” adopted by the National Convention on “Scrap NPS” and “Restore the defined Old Pension Scheme” held at New Delhi on the 21 st of January 2023
The National Convention on “SCRAP NPS” and “RESTORE THE DEFINED OLD PENSION SCHEME” held at New Delhi on the 21 st day of January 2023 hereby adopts the present declaration on the aim and purpose of this historicconvention with the ultimate objective to strive for Scrapping the National Pension System and to restore the defined Old Pension Scheme to the Central Government Employees, Employees of Various Autonomous bodies and Authorities, State Government Employees, Para Military Forces, and Teachers etc.
The National Convention believes that the experience of 18 years has fully demonstrated the truth that the National Pension System implemented by the Government of India unilaterally during the year 2003 for those Central Government Employees recruited on or after 01.01.2004 and subsequently by various State Governments, Autonomous Bodies and authorities, etc. has deprived Social Security to the Retiring Employees and has violated the following written assurance given by the Government of India in the Standing Committee meeting of the National Council JCM held on 14.12.2007. The relevant portion of the minutes of the meeting is given below.
“Under the NPS, pension system of the employees who entered government service prior to 01.01.2004 is not altered in any way hence, the NPS has no implication for this category of employees. For employees who has entered w.e.f. 01.01.2004 are not likely to be worse off vis-à-vis the current pension system in force, as the replacement rate would match to the present one. Thus, NPS is a win-win situation for employees and the government.”
However the above written assurance of the Government of India has been clearly violated which is evident from the following table/illustration wherein it is clearly proved that the pension under NPS is not at all matching with the Pension rate under the Old Pension Scheme.
Old Pension Scheme under CCS(Pension) Rules 1972 (at present CCS(Pension) Rules 2021
The old Pension Scheme is a Defined Benefit Scheme. Employees who have put in 10 years minimum
qualifying service are eligible for Pension. 50% of the last pay drawn is granted as monthly pension subject to a minimum guaranteed pension of Rs.9000/- per month + DR increase. Out of this monthly pension an amount equal to 40% of the Pension can be commuted while on superannuation (i.e. can be withdrawn in advance and which will be recovered and restored back after 15 years) and can get a lump-sum payment in advance. After commutation, the residual pension and DR on full pension will be paid for 15 years. If thePensioner dies before 15 years, then there is no need for repayment of the balance commuted pension. Apart from this the Pension increases after 80 years of age by 20%, 30% after 85, 40% after 90, 50% after 95 and 100% after 100 year of age. Whenever pay scales of the employees are revised by the Pay Commissions, the Pension also are simultaneously revised. Under this scheme Family pension is granted for spouses (Wife/Husband), unmarried/widowed/divorced daughters and crippled son /daughter who is not able to earn his/her livelihood. An employee who becomes medically unfit and boarded out from service are entitled for invalid pension and gratuity and employee who are crippled due to accident are eligible for extraordinary pension. Payment of gratuity or commutation amount do not attract any income Tax.
New Pension System/National Pension System(NPS – why employees oppose NPS)
The New Pension Scheme which is now called as National Pension system is not a Defined benefit
scheme. However it is a Defined contributory Scheme. While the contribution is defined, the benefit is not
defined. It is uncertain. However under the old Pension Scheme there is no contribution from the
employees and the benefits available in the old Pension Scheme like Pension, commutation and its
restoration, enhancement of pension after 80 years etc., are well defined. The Government of India by an
executive order on 22/12/2003 introduced NPS w.e.f. 01/01/2004. Subsequently during the year 2013 the
PFRDA Act 2013 was passed in the parliament. Legally it came into effect from 01/02/2014 through a
Gazette notification, which means legally the NPS has come in to force only w.e.f. 31/01/2014. However as
mentioned above it was given effect 01/01/2004 by Executive Instructions.
In accordance with the NPS the employees have to contribute 10% of basic pay + DA and Government
also contributes an equal amount as matching grant. However subsequently the Government has
increased its contribution to 14 percent. The total amount is distributed to three Pension Fund Managers of LIC, SBI & UTI. They invest 15 percent in share market and 85 percent in bonds, both Government and
private. In the NPS there is no guarantee for the returns on investments. There is a risk of loss of principle
element also. The employee at the time of retirement on attaining the superannuation age, 60 yrs., in the
case of Central Government Employees, a sum equal to 60 percent of the total available amount is given to the employee / retiree. Remaining 40 percent has to be invested in annuities and the retiree is given option to choose the company in which he/she can invest in annuity. This 40 percent investment of pension wealth in annuities is mandatory. In case an employee retires voluntarily from service before attaining 60 years of age, he will also be paid only 60 percent of pension wealth and balance 40 percent of pension wealth will be invested in annuities. For all other exit from service, the employee will get 20 percent and 80 percent has to be invested in an annuity for pension.
Though it is stated that this 40 percent or 80 percent does not attract any Taxto the actual amount of
investment, 18 percent GST is imposed. A comparative statement as given above on pension of the
recently retired NPS employees under the National Pension System(NPS), and in case they are in the old
pension scheme, what pension they must have received has given a clear picture of how the NPS
employees are being discriminated and left to the mercy of the market.
Pension is a Fundamental Right of the Employees
The historicjudgement, delivered on 17.12.1982 by the 5 Member Bench of the Hon’ble Supreme Court of
India, consisting of Hon’ble Chief Justice. V.D.Chandrachud, Hon’ble Mr. Justice V.D.Tulzaprukar,
Hon’bleO.Chinnappa Reddy and Hon’bleJustice M. Baharul Islam, declared as follows in the case
treated as Writ Petition Nos.5939-41 under Article 32 of the Constitution of India, known as D.S.Nakra and
others Vs. Union of India has established that Pension is a fundamental rightof the Government
“Para 31: from the discussion three things emerge (i) that pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer and that it creates a vested right subject to 1972 Rules which are statutory in character, because they enacted in exercise of powers conferred by the provison to Art. 309 and Clause(50 0f Art. 148 of the Constitution, (ii) that pension is not an ex-gratia payment, but it is a payment for the past service rendered, and (iii) it is a social welfare measure rendering socio-economic justice to those who in the heyday of their life ceaselessly toiled for the employer on an assurance that in their old age, they would not be left in the lurch.”
Appeal to the Government of India and State Governments
In view of all the above mentioned facts, this National Convention on “SCRAP NO GUARANTEE NPS”
and “RESTORE THE DEFINED GUARANTEED OLD PENSION SCHEME” held at New Delhi on the 21 st
day of January 2023 on behalf of the entire Central Government Employees,Employees of Various
Autonomous bodies and authorities, State Government Employees, Para military Forces and Teachers,
etcappeals to the Govt. of India and the Various State Governments to consider the following genuine
(1) To withdraw the National Pension System implemented to the employees who are recruited on or
after 01/01/2004 and to bring them all under the coverage of old pension scheme under
(2) To implement the GPF scheme to the employees who are recruited on or after 01/01/2004 by
depositing the accumulated employees contribution along with the returns to the GPF Account of
This convention accordingly formulates the following action programmesin the coming days by all the
organizations who are in the field fighting relentlessly for withdrawal/Scrapping of NPS and for restoration of Old Pension Scheme.
This National Convention gives a clarion call to the entire workforce of Government Sector both in Central
Government and State Governments and also other organizations who are governed under NPS to come
together and fight back with determination and commitment against the No Guarantee/UnassuredNPS and to restore the defined Guaranteed Old Pension Scheme and to continue the battle till we achieve this goal.