PFRDA to link pension system with employment guarantee scheme

Last Updated: Wednesday, September 1, 2010 - 00:12

New Delhi: Interim pension regulator PFRDA
today said it would soon link all citizen pension schemes with
the Mahatma Gandhi National Rural Employment Guarantee Scheme
(MNREGS) to ensure that each of the beneficiaries becomes
entitled to a pension.

Secretary-level discussions have commenced between the
Finance Ministry and Rural Development ministry in this
regard, because the MNREGS falls under the direct jurisdiction
of the latter, Pension Fund Regulatory Development Authority
(PFRDA) Executive Director P K Tiwari said at an Assocham

"The process will take a little more time before a policy
decision is taken in this regard," hinted Tiwari.

According to him, each beneficiary of the MNREGS will
have to open an account in a bank and deposit a minimum of Rs
1,000-Rs 1,200 every year, clearly telling the banks concerned
that this money should be transferred to National Security
Depository Limited (NSDL), which will issue a number to the
beneficiary of the MNREGS scheme.

Initially, the government launched the National Pension
System (NPS) for central government employees joining service
from January 1, 2004, but it was later extended to all
citizens from May 1, 2009.

The government will contribute an equal amount in such
accounts so that pension benefits are ensured for the common
man, said Tiwari, hinting that the current outgo of the
central government on the MGNREGS, which works out to be Rs
70,000 crore per annum, may be hiked to ensure that the NPS
covers everybody in the lower strata of society.

On the issue of parking surplus funds of pension fund
managers in infrastructure and equities, Tiwari clarified that
the regulator will not advice the pension fund managers to
place a part of their funds in speculative channels to ensure
that public money is not wasted.


First Published: Wednesday, September 1, 2010 - 00:12

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