New Delhi:
The Union Cabinet meets today and is expected to discuss and clear amendments to the Pension Fund Regulatory and Development Authority Bill, which has been stalled for years as political parties squabble over its provisions. The amended Bill makes provisions for guaranteed returns and provides for easier withdrawal from the national pension system.
Three changes are being made to the Bill - to allow a contributor to the pension scheme to withdraw funds in case of an emergency. To give subscribers a minimum assured return on investment and to provide a cap of 26% on foreign direct investment in the scheme.
The Bill, also called the Pension Bill, allows pension funds the flexibility to appoint a professional fund management company. Currently, these savings are invested in government securities that offer a fixed rate of return. The changes will affect how savings of nearly 25 lakh Indians are invested.
Also, under the National Pension System (NPS), every subscriber will have an individual pension account, which he can port with a job change. Every government employee hired since 2004 is covered by the NPS and it is voluntary for all other citizens since 2009 including the unorganized sector
The Bill ran into rough weather with the Left parties and the Trinamool Congress opposed to it. The BJP wanted the FDI cap of 26 per cent to be included in the PFRDA Bill. The government is said to have finally sewn up the support of the main Opposition party in the last Winter session by agreeing to the amendments sought.