A representative body for central government employees has requested the 8th Central Pay Commission (CPC) to ensure a minimum payout under the National Pension Scheme amid volatile market conditions. According to reports from NDTV Profit, the All India NPS Employees Federation (AINPSEF) submitted a memorandum to the panel on 10 May, asking for assured pension under NPS. The demand comes as a significant number of central government employees are set to retire in 2033.
Under the existing National Pension Scheme framework, central government employees contribute 10% of basic pay and dearness allowance (DA) towards NPS Tier-I scheme, while the Centre contributes 14% of basic salary and DA. As reported by NDTV Profit, the Centre's contribution of ₹1.82 crore is proposed to be held back and instead offered as a fixed pension at 50% of last drawn salary plus DA at retirement. The AINPSEF has pointed to market volatility as a key reason for seeking this update, noting that the retirement corpus of a large number of employees has failed to expand due to the current market situation.
For a Level 7 employee with approximately 33 years of service, the combined NPS corpus at retirement would amount to ₹3.13 crore (₹1.30 crore employee contribution and ₹1.82 crore government contribution). According to the AINPSEF analysis reported by NDTV Profit, taking pay progression into account, salary at retirement would reach ₹3.32 lakh with DA at 30%. The body estimates that the government's ₹1.82 crore contribution could provide a fixed pension at 50% of last drawn salary plus DA, addressing current market volatility concerns. However, the AINPSEF has noted that the current structure is built for long-term outflow of funds into NPS, making it difficult for the government to recover funds in the present system.
The AINPSEF highlighted that market volatility has failed to expand retirement corpus for a large number of employees, as reported by NDTV Profit. The body noted that investment returns under NPS have failed to keep up with inflation, potentially impacting pension income in the future. For employees on lower pay scales (Levels 1-5) and shorter service periods, or those in irregular positions, the current NPS structure provides minimal pension support, creating serious insecurity among lower and middle-income employees. The concern is that the government at present cannot recover funds as the current structure is built for long-term outflow of funds into NPS.
The 8th CPC held its first meetings with employee representatives last month as part of the consultation process. According to NDTV Profit, the panel opened formal memorandum submissions and held stakeholder consultations in Delhi in March and April, with planned meetings in Telangana, Ladakh, Jammu & Kashmir and Delhi in May and June. Notably, the Joint Consultative Machinery (NC-JCM) on 28 April demanded that NPS be scrapped and the old non-contributory Unified Pension Scheme (UPS) be restored, while retirees have sought periodic pension revision and restoration of commuted pension after 11 years. The reasoning is that staff had previously foregone provident fund benefits to opt for pensions, and there is also a demand for One Rank One Pension (OROP) for civilian employees.
