Centre announces committee under finance secretary to ‘improve’ NPS

Contributions under the NPS, which covers government employees who joined service after January 2004, are defined but the benefits depend on the market.

The committee on the NPS, which will be headed by the finance secretary, will strike a balance between the needs of the employees and fiscal prudence. (FILE)

Finance Minister Nirmala Sitharaman Friday announced the formation of a committee to “improve” the National Pension System (NPS) for government employees, a move that comes against the backdrop of at least four Opposition-ruled states adopting the Old Pension Scheme.

Speaking in the Lok Sabha during the consideration and passage of the Finance Bill, 2023, Sitharaman said the committee, which will be headed by the finance secretary, will strike a balance between the needs of the employees and fiscal prudence.

“Representations have been received that the National Pension System for government employees needs to be improved. I propose to set up a committee under the finance secretary to look into this issue of pensions and evolve an approach which addresses the needs of the employees while maintaining fiscal prudence to protect the common citizens. The approach will be designed for adoption by both central and state governments,” Sitharaman said.

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The treasury benches welcomed the announcement by thumping benches even as the Opposition members continued to raise slogans demanding the setting up of a Joint Parliamentary Committee (JPC) to probe the allegations against the Adani Group.

While the Old Pension Scheme offers defined benefits, under the NPS, which covers employees who joined service post January 2004, contributions are defined but benefits depend on the market.

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