As OPS Weighs Heavy On Jharkhand Treasury, State Govt Wants Its NPS Funds Back

(MENAFN- IANS) By Shambhu Nath Choudhary
Ranchi, May 6 (IANS) The Jharkhand government on September 1, 2022, restored the Old Pension Scheme (OPS) for state government employees in its cabinet meeting, following which people in the state expressed their gratitude to Chief Minister Hemant Soren.
The members of the Government Employees' Union applauded this decision taken by the Chief Minister and cabinet ministers.
Soren's party -- the Jharkhand Mukti Morcha (JMM) -- had promised to restore the OPS in its election manifesto before the 2018 state Assembly elections and had tweeted: "Another poll promise has been fulfilled."
Jharkhand is the fourth state which decided to restore the OPS. The Jharkhand government took this decision despite repeated warnings by the Reserve Bank of India, NITI Aayog and economic experts about the dangers of implementing the OPS. Experts say that in implementing this scheme, the state government will have to bear a lot of additional financial burden every year.
State Finance Minister and Congress leader Rameshwar Oraon has also conceded the fact that the Jharkhand government will have to bear an additional financial burden every year for implementing the OPS.
Oraon says, "The state government will have to bear an additional financial burden but we have to take this decision in the interest of the state government employees."
In the budget presented by the Jharkhand government for the financial year 2023-24, it has made a provision of Rs 700 crore for the OPS.
The state government had given the option to all its employees coming under the New Pension Scheme (NPS) that they can choose the OPS by December 31, 2022. According to the data of the Jharkhand Provident Fund Directorate, 1,16,303 government employees have given consent for the OPS, which is nearly 98 per cent of the total state government employees.
The Jharkhand government has implemented the OPS, but its biggest concern is what will happen to the National Securities Depository Limited's (NSDL) pension fund of former state government employees which is about Rs 17,000 crore before the OPS is implemented? The state finance minister had written a letter to the Central government for the return of the NSDL pension fund, on which no response has been received so far.
In response to a query in this regard during the last budget session of the Lok Sabha, Union Minister of State for Finance, Bhagwat Karad, had said that the states including Jharkhand, which have implemented the OPS will not be returned the amount deposited under the NPS.
Karad had said that there is no such provision in the Pension Fund Regulatory and Development Authority Act, under which the accumulated amount of subscribers i.e. government and employees' contribution in NPS, can be refunded to the state government.
If this amount is not received, the Jharkhand government will face a major financial blow. It is altogether a different matter that despite the burden on the state exchequer, the implementation of the OPS is likely to yield electoral benefits to the other political allies which are part of the Hemant Soren-led government.
Nearly 1.25 lakh families will benefit from the OPS scheme implemented by the Jharkhand government. The JMM would capitalise on the announcement of the OPS in the 2024 Assembly elections.
--IANS
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