The New Unified Pension Scheme, now notified by the Centre, will come into effect from the start of the 2025 fiscal on April 1. This would benefit over 30 lakh government employees who joined the service from the cut-off date of January 1, 2004. Among other things, the new contributory system promises a hike of the government’s contribution to the corpus (total money invested in the scheme) to 18.5 per cent from the previous offer of 14 per cent, while the employees’ contribution will remain at 10 per cent. It would be in everybody’s interest that government employees – of state and central – are paid reasonably well and their interests protected. At the same time, it should also not appear that the employees browbeat governments into submission and extract undue benefits.
Employee pension reform was one field where the BJP dispensation, in its iterations, failed to stand its ground. The National Pension System (NPS) introduced during the AB Vajpayee term in 2004 had been cited as an “improvement” on the Old Pension Scheme (OPS). NPS was also known as the Contributory pension system, wherein those who joined the government service from January that year had to make a contribution matching with a government contribution to the pension corpus. The employees took objection, but finally agreed to it by extracting a set of additional pecuniary benefits to them from the government. After having won such benefits, momentum started building in some states against the contributory pension system. Some regional parties, followed by the Congress, promised in their election manifestos for assembly polls in states like Punjab, Chhattisgarh, Himachal Pradesh etc to revert to the old pension system; and they did so after winning the polls. This put additional pressure on the Modi-led central government to reconsider the National Pension System. Stories were spread that the BJP failed to garner sufficient seats for a majority in Parliament in the 2024 LS polls due, mainly, to the discontentment of government employees and their families. Sections of the media played this up. The Unified New Pension Scheme that will be rolled out from April next too might or might not satisfy the employees. They are bound to find “flaws” in it and eventually start applying pressure on future governments for further revisions to their advantage.
Every time a new government is formed, it is called upon to “do more” for the employees, who with their families, are projected to be an organised “vote bank” – a proposition which might or might not be true, and not based on ground realities in the election fray. The policy of any government worth its name should be to give every citizen what is his or her due; nothing less, nothing more. In the present case, the Congress and the regional parties helped create a mess out of the reforms in the pension system. They did so with ulterior motives; and with no regard to national interests.
