In a serious bid to avoid backlash in the ensuing Lok Sabha and state assembly elections, the MahaYuti government comprising BJP, Eknath Shinde-led Shiv Sena, and Ajit Pawar-led Nationalist Congress Party, will decide to reinstate the Old Pension Scheme (OPS). Deputy Chief Minister Ajit Pawar, who had earlier strongly opposed the reinstatement of OPS, on Tuesday admitted that he has changed his stand and would reconsider it positively. Pawar, who holds planning and finance departments, said that the state government wants to strike a balance between salaries, pension, and its burden on state finances.
There are over 17 lakh employees, including government and semi-government employees and teaching and non-teaching staff in government and aided schools while there are 600,000 pensioners. Around 3 percent of employees retire every year. The state government’s outgo towards the salary of its over 17 lakh employees was worth Rs 1,31,986 crore and Rs 56,300 crore on pension in 2022-23. DCM Devendra Fadnavis, who had expressed his opposition to OPS, had last year projected that the government would need Rs 1.10 lakh crore to implement the OPS, potentially bankrupting the state.
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‘’Chief Minister Eknath Shinde, DCM Devendra Fadnavis, and I have already held a primary discussion on the reinstatement of OPS. DCM Devendra Fadnavis had opposed the reintroduction of OPS and that was also my stand when I was state finance minister in the past. However, the Centre is working to address the issue in the run-up to the Lok Sabha elections. The eligible people will get the benefits from 2021,’’ said Pawar.
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Pawar’s announcement came on a day when the government employees took out a massive morcha at Nagpur demanding reinstatement of OPS. Further, the trigger was also the speech by former chief minister and Shiv Sena Uddhav Balasaheb Thackeray chief Uddhav Thackeray, who visited the morcha venue, and declared that had he been the CM he would have decided on the reinstatement of OPS. ‘’Give them (MahaYuti Government) a tension for pension,’’ he exhorted the protesters. Thackeray, who was accompanied by his son and former minister Aaditya Thackeray and party MP Sanjay Raut, extended his party’s wholehearted support to the agitating government employees for the demand for reintroduction of OPS.
Furthermore, Congress legislator Nana Patole raised the issue of reintroduction of OPS taken up by the agitating government employees at the morcha.
A four member committee headed by former BrihanMumbai Municipal Corporation Commissioner Subodh Kumar recently in its report has indicated that the reinstatement of OPS can be a huge drain on the state exchequer. However, the committee, which included retired IAS officers KP Bakshi and Sudhir Srivastav and Director (accounts and treasury) has recommended benefits equal to OPS to the retired government employees by making some three to four changes in the present system. The OPS was discontinued in 2005 after the state government shifted to the New Pension Scheme (NPS).
As per the committee’s report, retired government employees can get benefits equal to 50% of the last drawn salary which was given as a pension in the OPS. However, after the scrapping of OPS, the retired government employees under the New Pension Scheme (NPS) get 60% lump sum after retirement and 40% invested in annuities as pension. In OPS, the government employees do not contribute any amount but in NPS the government employees contribute 10% of their salary (basic + dearness allowance), while the government’s contribution is 14%.
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