Confusion remains on J&K govt’s contribution to employees’ NPS

TNN Bureau. Updated: 12/2/2019 4:05:34 AM Front Page

Centre hike its part to 14%, J&K still contributing 10%

JAMMU: Uncertainty is looming large over the newly created Union Territory (UT) administration’s contribution towards employees’ New Pension Scheme (NPS) accounts following its transition to a union territory and thus its over 4.5 lakh employees becoming eligible for central service benefits.
As of now, J&K is still contributing 10 percent to the NPS accounts, which is four percent less as compared to the centre’s contribution which was hiked from 10 percent to 14 percent with effect from April 1, 2019.
“The monthly contribution would be 10 percent of the Basic Pay plus Dearness Allowance (DA) to be paid by the employee and 14 percent of the Basic Pay plus DA by the Central Government,” the central government had said on January 31, 2019.
Despite the lapses of more than seven months, the J&K administration is contributing 10 percent towards employees NPS accounts.
Even after becoming the Union Territory (UT) on October 31, no decision on increasing the contribution in line with the Central government’s, has been take so far.
“The centre government has issued no directions in this regard. The decision will be taken by government of India in this regard,” a General Administration (GAD) official told The News Now.
NPS was launched in the state of Jammu and Kashmir from January 1, 2010. NPS, which is mandatory for all the employees joining government services post 2010, is a defined contribution scheme wherein both the employer and the employee contribute 10 percent of the basic pay and dearness allowances every month after joining a government service.
On retirement, subscribers can withdraw a part of the fund corpus in a lump sum and use the remaining part to buy an annuity to secure a regular income after retirement. 
Since its inception in 2004 at Central Government level and in 2010 at State Government level, the investments are performing more than good.
The average Investment Rate of Return (IRR) has been more than 10 percent.
After Jammu and Kashmir officially become Union Territory (UT) on October 31, the 4.5 lakh government employees become eligible to avail all the financial facilities at par the centre government employees.
Although on November 29, the J&K administration extended various benefits of Central pay grade in favour of the J&K government employees, but there was no announcement on the NPS account.

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