The government is reviewing its proposal to allow private-sector workers to switch between the Employees’ Pension Scheme (EPS) and the National Pension Scheme (NPS).
“EPFO has supported Government’s proposal to allow its subscribers switch to the National Pension System but said the move needs to be backed by suitable amendments to the Pension Fund Regulatory and Development Authority Act”
The review has come as representative employers and employees offered mixed reactions in a recent consultation meeting with the labour and employment ministry. While the EPFO is backing the proposal, the Bharatiya Mazdoor Sangh (BMS) rejected the amendment on grounds that NPS is risky and market-linked and returns on EPS are much more. According to media reports.
The government had proposed amendments to the Employees’ Provident Fund Act, 1952 in August. The move was initially announced by former Finance Minister Arun Jaitley in his Union Budget 2015-16 speech. The amendment proposed to allow private employees an option to switch between EPS and NPS, which is currently not possible.
The Central Board of Trustees of the EPFO, chaired by the labour minister, is likely to meet next month to deliberate over the proposed amendments, following which the retirement fund body’s view will be finalised. The labour ministry had called for a tripartite meeting last month on the proposed amendments to the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, which 10 central trade unions boycotted.