National People’s Party Arunachal Pradesh briefs media on National Pension Scheme
By The Space
By Asin Charu
ITANAGAR: National People’s Party (NPP), Arunachal Pradesh unit, State General Secretary Paknga Bage in a press briefing today discussed several concerns of the NPP regarding National Pension Scheme (NPS), demerits of the scheme, objectives of the NPP and recommendation for remedial measures.
Major Concerns of the NPP regarding the scheme
National Pension Scheme (NPS) was implemented in Arunachal Pradesh in the year 2008. However, it came into effect for the central government prior since 2004. For reference, say state’s 10% of the population is employed in the government service sectors, the employed member then in such case by typical standards and norms would financially be bound to support at least 10-11 members in the family tree. This, as stated earlier in the briefing, happens due to lack of industries, less employment scheme in the tourism sector or possibly owing to the factor of less consumers and poor scope in the VC (Venture Capital) sector.
Statistically speaking for instance on a rough estimate, if the overall population in Arunachal Pradesh is 11 lakhs, then around 1 lakh of the population would consist of the people engaged in government service sectors, with the remaining 10 lakhs population to be dependent on the other counterpart.
“If NPS is not for the welfare of the government employees, it is of a grave concern because it largely impacts not just the 1 lakh population of government employees but simultaneously the other 10 lakhs population dependent on it- the prime reason why there is an immediate need for the recovery of the old pension system,” says Bage.
Objective of the NPP
NPP is a part of the North-East Democratic Alliance and alliance party with BJP. NPP claims, they have always stood firmly alongside the government when it comes to the welfare of its people and wishes to do the same. However in cases like NPS where there are certain apparent loopholes, the NPP advises the coalition partner BJP, to look over the matter for the welfare of its people.
In the backdrop of the grievances addressed, many government organisation of the state previously revolted against the newly implemented pension system. Further, since the government of Arunachal Pradesh and the Service Federation could not come to a mutual concession, the fight prolonged when eventually in 2013, the government of Arunachal Pradesh, signed an MAU with National Depository Limited, Mumbai and in terms of retrospection that came into effect since 2008.
New NPS method
As stated in the press briefing, the new NPS method holds that, for those who were appointed in the government sector after 2008, 10% of the entire salary is deposited and the same deposit would be contributed by the government of India and dispensed via 1 tier or 2 tier account. If a government employee expires before their retirement, neither the family nor any nominees will be eligible to claim any pension benefits. In case of serious medical conditions like paralysis or stroke, the concerned employee will not be eligible for the Voluntary Retirement Scheme (VRS).
Demerits of the NPS system
Unlike the old pension system where an employee could withdraw 90% of their deposited amount, the new NPS system reduces the withdrawal benefits to 60%. Whereas, the remaining 40% is being invested in the shares market which has no return guarantee. On the other hand, grade C and D employees may not be concerned enough as they may be less educated than that of grade A and B officers. To sum up, the new NPS system impacts all grades of employees. However, grade C and D may be the less fortunate and vulnerable, given their contributions.
Be it grade A officers or grade D staffs, during their government duties, if faced with an accidental death, the new NPS system in such cases will not avail any pension grants to the bereaved family. However in the old pension system such provisions were available regardless of one’s contribution period. In case of critical illness, the new NPS system does not provide Voluntary Retirement Scheme (VRS) to the person, whereas, in the old system it was available. For fact, in the old system, 50% of the basic pay was compensated to those with such critical health conditions as opposed to the new system that has no such provisions.
Two remedial measures recommended by the NPP
1. NPS with certain modifications: All government employees ranging from group A officers-to-peons given the inevitable circumstances that they expire before 15 years of their service tenure, be it on-duty/natural death, in such cases the NPP demands benefit claims from the old pension system to the bereaved families/nominees for economic support.
2. Secondly, if the government employee does not expire and undergo serious medical conditions like paralysis or stroke, NPP demands, they be made liable to claim the benefits of the old pension system, as any contributions within the 15 years of service tenure would be of minimal amount, which in turn may not sufficiently add up to economically support the families/nominees of the concerned employee.
It has been stated in the press conference by NPP State General Secretary Paknga Bage in solidarity with various service federations of the state, such as Arunachal Pradesh Labour Union that, if the two modifications cited above fail to be implemented, the current NPS system should be scraped and the old system be renewed.