• Dr. PR Vyas

Ashok Gehlot, the Chief Minister of Rajasthan, has termed the old pension scheme as a bulwark of socio-economic security. His decision to implement it once again in the state, will attract a large of number of talented youths towards government service in future.

About 5.50 lakh employees will benefit

Under the new pension scheme, about 5.50 lakh employees will now get this benefit. Chief Minister Gehlot also announced a pension of Rs. 20,000 for players above 40 years of age. At the same time, he said that a women’s cooperative bank would be opened in Jaipur, which would give loans to women. Initially, the government will give a fund of Rs. 250 crores to this bank.

Long-standing demand for old pension:

The Chief Minister of Rajasthan, Shri Gehlot said that the new pension system in its present form is problematic. Employees across the country are demanding the restoration of the old pension system . What are the differences between the old pension scheme and the new pension scheme?

The old pension was closed in 2005

After April 2005, the then Prime Minister Atal Bihari Vajpayee’s central government had stopped the old pension for appointments. A new pension scheme was introduced. After the central government, the states too did not lag behind in implementing the new pension scheme. However, it was not mandatory. The union believes that at that time the employees could not understand this new pension scheme. They felt as if this scheme would give them more benefits than the old pension scheme after retirement, but this proved to be an illusion and for the last many years, protests have been taking placeagainst the new pension scheme.

What actually are the differences between the two pension schemes?

What are the 10 big differences between Old Pension Scheme and New Pension Scheme

Old Pension Scheme (OPS) and New Pension Scheme (NPS) • There is no deduction from the salary for pension in the Old Pension Scheme. In the New Pension Scheme, there is a deduction of 10 percent (Basic + DA) from the salary of the employee. • The old pension scheme has the facility of GPF (General Provident Fund). The facility of General Provident Fund (GPF) has not been added to the New Pension Scheme. • The Old pension is a secure pension plan. It is paid through the Treasury of the government. The new pension scheme is stock-market based. The payment is made only on the basis of market developments. • In the old pension, fixed pension is available up to 50 percent of the last basic salary at the time of retirement. There is no guarantee of fixed pension at the time of retirement in the New Pension Scheme. • Dearness Allowance (DA) is applicable after 6 months in the old pension scheme. Dearness allowance received after 6 months is not applicable in the New Pension Scheme. • Gratuity up to Rs. 20 lakh is available after retirement in OPS. There is a temporary provision of gratuity at the time of retirement in NPS. • There is a provision of family pension in case of death during service in OPS. In NPS, family pension is available on death during service, but the money deposited in the scheme is forfeited by the government. • There is no income tax levied on GPF interest on retirement in OPS. The money received in NPS on retirement basis will be taxed on the basis of stock market. • No investment is required from GPS to get pension at the time of retirement in OPS. To get pension on retirement in NPS, 40 percent money has to be invested from the NPS fund. • There is a provision of 40 percent pension commutation in OPS. This provision is not there in NPS. Medical Facility (FMA) is there, but there is no clear provision in NPS. Credit for First-time Implementation across the Country Chief Minister Ashok Gehlot has credited his government for being the first to implement the Old Pension Scheme across the country. The Chief Minister said that employees and officers have an important role in efficient and good governance and thus, they should not worry about their future.

The Chief Minister said that under the new pension scheme, when the employee’s money accumulates after 35 years, it goes to the stock market. Employees get money according to the prevailing condition of the stock market at that time. That’s why employees constantly keep worrying about their future.

Welcome of the Verdict across the Country Chief Minister Ashok Gehlot said that we have implemented the old pension scheme for the state employees, due to which there is a wave of happiness among the employees of Rajasthan as well as our decision is being appreciated all over the country. Many people are also criticizing it, but we don’t care.

The Old Pension Scheme restored in Rajasthan In order to protect the interests of the employees of the Government of Rajasthan and to provide them security after retirement, the Congress Government of Rajasthan has decided to restore the old pension system for all the employees who joined the Government service after January 1, 2004.

The Old Pension Scheme will be applicable from the Financial Year 2022-23 In his budget speech, Shri Ashok Gehlot said that on February 23, 2022, it has been announced in the assembly to implement the old pension scheme from the next financial year. This decision has been welcomed not only by the Rajasthan government but also by the employees of all the states.

Difference between Government and Private sector jobs The Rajasthan CM said, ‘The main difference between the government and private sector was of the pension. Government jobs cannot have a pay scale more than a certain limit, but due to future security from pension, talented youth used to give priority to government jobs.

Talented Youth will be attracted towards Government Services Shri Ashok Gehlot said that it has been seen that after the implementation of the New Pension System (NPS), the inclination of the talented youth towards government jobs had reduced. Due to the decision to re-implement the Old Pension Scheme, a larger number of talented youths will be attracted towards government services in future.

Employees depend on Pension for survival after Retirement The Chief Minister has issued a statement saying that the Congress Party and the Congress Government of Rajasthan are well aware of their duty of providing socio-economic security to their people. He said that a government employee serves for 30-35 years and after retirement, depend on pension for his/her survival.

It is the duty of the elected government that the employees should live with a sense of security.

The CM of Rajasthan said that it is the duty of every elected government to ensure that its employees lead a life with a sense of security, so that they too can make their valuable contribution to good governance. According to Shri Gehlot, with a view to strengthen the socio-economic base of government employees, the Central Civil Service (Pension) Rules, 1972 were implemented, in which provision of pension / family pension, gratuity and commuted amount, was made.

The Country made great progress in the Old Pension System Shri Ashok Gehlot said that it is believed that the Old Pension System will increase the financial burden on the governments and the work of development and public welfare will be affected. He said that it is important to understand the fact that even when the old pension system was in force, the country had made tremendous progress in every field. He said that the works of development and public welfare were never curtailed due to the old pension system.

(The author is a former head and professor (retired) in the Department of Geography, Faculty of Earth Sciences, Mohanlal Sukhadia University)