The Bill will be tabled in the next session of Parliament.
Among the important suggestions, the Standing Committee on Finance headed by
Yashwant Sinha, had favoured 26% cap on foreign direct investment (FDI) in
pension programmes. Currently, FDI is not allowed in pension schemes.
The Bill, which was introduced in the Lok Sabha on March 2011, was referred
to the Standing Committee for consideration. The government is likely to
take up the Bill for passage during the Winter Session of Parliament
beginning November 22.
The Committee had also recommended that subscribers to the New Pension
System (NPS) should get an assured return on their investments that is at
least equal to the interest rate given by the Employees’ Provident Fund
Scheme.
The NPS, launched in January, 2004, has about 24 lakh subscribers, mostly
those employed by the central government.
In India, no pension fund management company offers a guaranteed pension
product.
Subscribers to the Employees Provident Fund Organisation (EPFO) get 9.5%
interest on their contribution.
The committee wanted the government to make concerted efforts to extend the
coverage of the scheme in both the public and private sector. Currently,
pension schemes are being monitored by an interim regulator, the PFRDA.
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