Srinagar, Aug 29: In a significant development, the Jammu and Kashmir cabinet today approved the New Pension Scheme to do away with the existing pension rules for fresh recruits in the government jobs. The NPS will be implemented from January 1 next year, denying existing pensionary benefits to the employees recruited after January 2010.
The NPS is on the pattern of Central Government, which too has done away with the pension and set up a statutory body for the employees to avail themselves of pensionary benefits on their own. “It would be almost similar on the pattern of Contributory Provident Fund (CPF), which was binding on Public Sector Undertakings, limited companies and organizations employing more than 10 people,” sources in the finance department told Greater Kashmir.
The state government, like the centre and other states, was unable to bear the ever-escalating cost of pensions, running into several crores, which continued to go up every year with the retirement of its staff, the sources said.
“Under the NPS, an employee would contribute 10 per cent from his salary. An equal amount would be contributed by the government and deposited in the employee’s account with the Pension Fund Development and Regulatory Authority (PFDRA) to be set up by the government,” the commissioner/secretary, Finance, Sudhanshu Pandey, told Greater Kashmir. He said the pensioner can draw the pension anywhere from designated post offices and banks.
Detailed guidelines of the NPS would be worked out within a couple of months after the implementing agency is set up, sources said, but added that in no case the employees being recruited from January 1, 2010 would be liable to pensionary benefits.
“Annual increase of expenditure on account of pension is going out of the control of the Government. Unlike gradual increase in salary bills, usually on account of increase in Dearness Allowance (DA) and normal annual increments in basic pay, the increase in pension bills takes place simultaneously on account of increased DA as well as post retirement benefits payable at the time of superannuation”, sources said.

Lastupdate on : Sat, 29 Aug 2009 21:30:00 Makkah time
Lastupdate on : Sat, 29 Aug 2009 18:30:00 GMT
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