Bhubaneswar: To ensure social security of employees of urban local bodies (ULBs) after retirement, the State Government is going to include the ULB staff under the National Pension System (NPS) soon. It has been decided that all the 115 ULB’s staff in the State will join NPS.
According latest review on NPS implementation in the State of Odisha being taken up Vishal Dev, Principal Secretary Finance reveals that two types of pension schemes for government employees are functioning in the state.
According to officials, Old pension scheme is being regulated by Odisha Civil Services Pension Rules 1992 while another is the National Pension System (NPS), which is mandatory for State Government Employees who have joined services on or after 1st January, 2005 in regular pensionable establishment.
At present, around 3 lakh State Government employees are covered under NPS while another 2 lakh covered under the old pension system.
Thanks to the overdrive of Shri Dev, the Department of Finance has taken a lot of measures for the benefit of the NPS covered employees in the State. The Department of Finance has made an online system for the newly joined employees.
The employees can also deposit their NPS share directly on the Trustee Bank on online mode. The IFMS and CRA have been integrated with the Trustee Bank for smooth registration and NPS deposit, the official said.
Additional Secretary Finance Siddhartha Das along with Director Treasuries & Inspection, Rupa Narayan Das is sincerely implementing the program.
Deputy Director Treasuries and Inspection, Nishikanta Mishra has been engaged in day to day monitoring of the NPS, said sources.
All the State PSUs, which were covered under the old pension system, have been brought under NPS with effect from January 2005, mandatorily while other State PSUs, if they want, can join the National Pension Scheme at any time, the officials said.
So far, 35 State Public Sector Undertakings have been covered under the NPS. Various workshops and conferences are being organised with the help of CRA-Protean and Pension Fund Regulatory & Development Authority (PFRDA) to provide NPS coverage to the un-registered State Autonomous Bodies & State Public Sector Undertakings.
The Director of Treasuries & Inspection, Odisha has been nominated as Nodal Officer for implementation of NPS in the State while a special NPS Cell has been formed under the supervision of the Director in this regard.
When one joins in government Service, he/she has been allotted a unique Permanent Retirement Account Number (PRAN), issued by CRA, NSDL. The PRAN account will remain valid till the age superannuation. The subscriber can continue to contribute to the PRAN account even after she/he quits the Government service.
Newly joined employees shall submit application (CSRF) to DDO within seven days from joining, who shall forward the same with certificate to Treasury. The Treasury Officer will verify the CSRF received and forward it with her/his approval to the NPS Cell, of Directorate of Treasuries & Inspection, Odisha, who will process and send it to the facilitation centre of CRA. Regular monthly contribution shall start from the salary of the 2nd month of Joining in a particular establishment.
The monthly NPS contribution has been increased from 10 percent to 14 percent. The next of kin of the employee will get pension in case of death of the employee during his service period. The State Government has also decided to start the NPS Audit soon, informed the officials.
It is a matter of happiness that about 95 percent of the employees are timely contributing their NPS, which is being deposited in their PRAN within seven days of deduction.
There are various tax benefits under NPS. Employee Contribution: Deduction up to 10% of salary (basic+ DA) within overall ceiling Rs.1.50 Lakh u/s 80C. Voluntary Contribution: Deduction up to Rs.50,000 u/s 80 CCD(1B) from taxable income for additional contribution to NPS. Employer Contribution: Deduction up to 10% of salary (Basic + DA) from taxable income u/s 80 CCD(2). This is over and above the limits u/s 80C.
After 10 years of regular contributions, one can withdraw money from a Tier-I Account. The withdrawal amount is limited to 25% of the total subscriber’s contribution.
Similarly, Tier-II Account can be opened by a subscriber at any point of presence by showing the PRAN. Tire-II Account functions as a savings Bank Account. Withdrawal from that account shall not require any sanction. It operates as a saving Bank Account which will meet the financial requirement of the subscriber at exigency.