Ritika
New Delhi: NITI Aayog Vice-Chairman Suman Berry on Sunday expressed concern over the re-introduction of the Old Pension Scheme (OPS) by some states. He said this would put a burden on future taxpayers at a time when India needs to focus on improving its fiscal position and promoting sustainable development.
In an interview to PTI, Berry underlined the need to increase capital expenditure and create space for the private sector through fiscal consolidation. He said, “I have a little concern about the revival of the old pension scheme. I think this is a matter of concern because the burden will not be on the existing taxpayers but on future taxpayers and citizens.
The entire amount of pension under OPS was given by the government, this scheme was discontinued by the National Democratic Alliance (NDA) government from April 1, 2004. Under the new pension scheme, the employees contribute 10 per cent of their basic salary towards pension while the state government contributes 14 per cent. “Political parties should exercise discipline as we all are working for the common goal of growth of the Indian economy so that India becomes a developed economy,” Berry said. It is necessary to balance short term goals with long term goals.
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Congress-ruled Rajasthan and Chhattisgarh have already decided to implement OPS, while BJP-ruled Himachal Pradesh has promised to revive the scheme if voted to power. Jharkhand decided to launch OPS and Aam Aadmi Party-ruled Punjab also recently approved the re-implementation of the scheme.
However, he pointed out that the borrowing of states has been effectively capped by the Reserve Bank, so there is no threat to economic stability from the states. “We need to start making room for the private sector through financial consolidation over the next two years,” Berry said. (agency)
