6 Months GPF Interest Rate Reduced by 0.1 Percent for Fin. Year 2016-17

Recently a resolution issued about GPF Interest rate w.e.f. 01.01.2017, as per this resolution the interest rates on GPF and other similar funds are reduced by 0.1 % w.e.f. 01.01.2017 for all Central Government Employee.

(PUBLISHED IN PART I SECTION OF GAZETTE OF INDIA)

F.No.5(1)-B(PD)/2016

Government of India

Ministry of Finance

Department of Economic Affairs

(Budget Division)

New Delhi, Dated the 18th January, 2017

RESOLUTION

It is announced for general information that during the year 2016-2017, accumulations at the credit of subscribers to the General Provident Fund and other similar funds shall carry interest at the rate of 8.0% (Eight per cent) w.e.f. 1st January, 2017 to 31st March, 2017. This rate will be in force w.e.f. 1st January, 2017. The funds concerned are:-

1. The General Provident Fund (Central Services)
2. The Contributory Provident Fund (India)
3. The All India Services Provident Fund
4. The State Railway Provident Fund
5. The General Provident Fund (Defence Services)
6. The Indian Ordnance Department Provident Fund
7. The Indian Ordnance Factories Workmen’s Provident Fund.
8. The Indian Naval Dockyard Workmen’s Provident Fund
9. The Defence Services Officers Provident Fund
10. The Armed Forces Personnel Provident Fund.

2. Ordered that the Resolution be published in Gazette of India.

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(Vyasan R.)

Deputy Secretary (Budget)

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Latest Procedure for implementation of National Pension Scheme (Tier-I) to the State Government employees & Others.

Recently, Maharashtra State Government has issued a resolution regarding The procedure for implementation of National Pension Scheme (Tier-I) applicable to the State Government employees as well as officers of the AIS of the Maharashtra cadre which is as under:

Introduction :

The Defined Contribution Pension Scheme was introduced for the State Government employees with effect from 01/11/2005 vide GR at sr. no. 1 above. The State Government has joined the National Pension Scheme of the Central Government vide GR at sr. no. 13 above. Therefore, the Defined Contribution Pension Scheme has now been renamed as “National Pension Scheme” (NPS).

The State Government entered into an agreement on dt.10/10/2014 with the National Pension Scheme Trust (NPS Trust) established by the Government of India. Similarly, the State Government also entered into an agreement on dt.10/10/2014 with M/s National Securities Depositories Limited-e-Governance Infrastructure Limited, who have been appointed as the Central Record Keeping Agency (CRA) by the Government of India.

The State Government is pleased to prescribe the procedure of Tier-I for the implementation of the National Pension Scheme. 

Download Resolution (Click Here)

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DCPS of State Govt. merging with NSP of Government of India.

Maharashtra Government has issued a resolution on 21.08.2014 for Merging the New ‘Defined Contributory Pension Scheme (DCPS) of State Government with the New Pension Scheme (NPS) of Government of India.  The detailed resolution are as under:

Government of Maharashtra
Finance Department

Government Resolution No.: CPS-2012/C.R.96/SER-4

Hutatma Rajguru Chowk, Madam Cama Road,

Mantralaya, Mumbai - 400 032.

Date: 21st August, 2014.

Read - 1. Government Resolution No.: No.CPS 1005/126/Ser-4 Dated 31.10.2005
            2. Government Resolution No.: CPS 1007/18/Ser-4 Dated 07.07.2007

Introduction-

State Government has implemented the New Defined Contributory Pension Scheme on the lines of Government of India, to the employees who are recruited on or after 1st November, 2005 vide Government Resolution referred at No.1. Government had also taken a decision to join Government of India’s scheme for the purpose of implementation.

2. State Government has already formed the State Record Keeping Agency (SRKA) vide Government Resolution referred at No.2 and is implementing the scheme through this Agency, pending formation of the Central Record Keeping Agency (CRKA) by Government of India Government Resolution No.: CPS-2012/C.R.965/SER-4

Resolution -

3. State Government is pleased to join the New Pension Scheme (NPS)of the Government of India w.r.t. the employees who are recruited on or after 1st November, 2005 in the State Government, the Zilla Parishadas, Recognized and Aided Educational Institutions, Non - Agricultural Universities and affiliated Non - Government Colleges and Agricultural Universities etc. Therefore the New “Defined Contributory Pension Scheme” which is implemented in the State will be henceforth called as the “New Pension Scheme” (NPS)

4. State Government has also decided to appoint the State Record Keeping Agency (SRKA) as the State Nodal office and the Director, Accounts and Treasuries, as the State Nodal Officer after joining Central Government’s New Pension Scheme.

5. Detailed instructions about the procedure of implementation will be issued separately after executing due agreement with the Central Record Keeping Agency (CRKA).

This Government resolution of Maharashtra Government is available at the web site www.maharashtra.gov.in. Reference no. for this is 201408211208270505

This order has been signed digitally. By order and in the name of the Governor of Maharashtra.

(N.B.Ringne)

Deputy Secretary to Government of Maharashtra

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New Pension Scheme (DCPS) and Tax Deductions.

The New Pension Scheme works on defined contribution basis and will have two tiers – Tier-I and II.  Contribution to Tier-I is mandatory for all Government servants joining Government service on or after 1-1-2004 (Maharashtra State (DCPS)  w.e.f. 01.11.2011) (except the armed forces in the first stage), whereas Tier-II will be optional and at the discretion of Government servants.

Employee’s Contribution:
Deduction is available under section 80CCD(1) in respect of employee’s contribution in the year in which contribution is made. However no deduction is available in respect of Employee’s contribution, which is in excess of 10% of the salary of the Employee.

Employer’s contribution:
Employer’s contribution to NPS is taxable as salary income in the year of contribution. However, Deduction available is under section 80CCD(2) in respect of employer’s contribution- Contribution by employer to NPS is deductible in hands of the concerned employee in the year in which contribution is made. However, no deduction is available in respect of employer’s contribution which is in excess of 10% of the salary of the employee.

Deduction & Taxability:
Employer & Employee contribution forms part of the income of the salaried assessee as mentioned above. Both the contributions are eligible for deduction u/s 80CCD read with section 80C of the IT Act. The aggregate amount of deduction under section 80C, 80CCC and 80CCD cannot exceed Rs. 1,00,000/-.

Other Information:
Pension (or any other payment) out of NPS account (for which deduction has been claimed under section 80CCD) will be taxable in the hands of recipient. If, however, the amount of pension received from NPS is used for purchasing an annuity plan in the same previous year, then it will be exempt from tax.

For calculating 10% limit for the above purpose, “salary” includes dearness allowance, which will be deducted from his salary bill every month by the PAO concerned.  The Government will make an equal matching contribution.  However, there will be no contribution from the Government in respect of individuals who are not Government employees.

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Enhancement of amount of CPF retirees and dependent family members of the deceased.

No.1/10/2012-P&PW (E)

Government of India

Ministry of Personnel, P.G. & Pensions

(Department of Pension & Pensioners’ Welfare)

3rd Floor, Lok Nayak Bhawan,

Khan Marke, New Delhi 03

Dated: 27th June, 2013.

OFFICE MEMORANDUM

Sub: Enhancement of amount of Ex-gratia payable to pre-1986 CPF retirees and dependent family members of the deceased pre-1986 CPF employees regarding.

The undersigned is directed to refer to this Deartment’s OM No.45/52/97-P&PW(E). dated 16th December, 1997 sanctioning monthly payment of an amount of Rs.600/- as ex-gratia, to CPF beneficiaries who had retired from service prior to 1.1.1986. This amount was payable w.e.f. 01.11.1997. Similarly, monthly ex-gratia being paid to the widows and dependent children of the deceased CPF beneficiaries who had retired from service prior to 1.1.1986 and the widows and dependent children of the CPF beneficiaries who died while in service prior to 1.1.1986 had been revised from Rs.150/- to Rs.605.

2. Reference is also invited to this Department’s O.M. No.42/2/2004-P&PW (G), dated 15th March, 2004. In terms of this O.M., dearness relief equal to 50% of the above amounts of ex-gratia had been converted into dearness ex-gratia w.e.f. 1st April, 2004. Consequently, dearness relief, as announced frrn time to time is being paid, on the sum of the amounts of ex-gratia and dearness ex-gratia.

3. This Department has since been receiving representations from the CPF retirees who are in receipt of ex-gratia in terms of the above instructions, to enhance the amount of ex-gratia. The matter has now been considered and the President is pleased to enhance the existing amount of ex-gratia of Rs.600/- p.m. being paid to the surviving CPF retirees and the amount of ex-gratia of Rs. 605/- p.m. being paid to dependent members of the families, i.e., widows and dependent children of deceased beneficiaries at the following rates w.e.f. 4th June, 2013:

S.No.	Group of Service to which CPF retirees  belongedat the time of retirement	Enhanced amount of basic  monthly ex-gratia
1.	Group ’A’ Service	Rs.3000/-
2.	Group 'B' Service	Rs.1000/-
3.	Group ‘C’ Service	Rs.750/-
4.	Group ’D’ Service	Rs.650/-
5.	Widows and dependent children of the  deceased CPF beneficiary	Rs. 645/-

4. Dearness ex-gratia equal to 50% of the enhanced amount of ex-gratia and Dearness Relief, as notified from time to time, on the sums of enhanced amounts of exgratia and dearness ex-gratia shall also be admissible to them.

5. The terms and conditions for grant of ex-gratia and dearness relief will continue to be governed by this Departrnent’ O.M. No.4/1/87-PIC, dated 13th June,1988 and O.M. No.45/52/97-P&PW (E), dated 16th Dccember, 1997 and subsequent Office Memorandums issued in this regard.

6. As laid down in the Ministry of Finance O.M. dated 28.11.1969, the ex-gratia payment is not admissible to (a) those who were dismissed/removed from service and (b) those who resigned from service.

7. It shall he the responsibility of the Head of the Department of the Ministry, Department, Office, etc. from which the CPF beneficiary had retired or where he was working prior to his demise to revise the ex-gratin with effect from 4th June, 2013 and to issue revised Ex-gratia Payment Order (EPOs). Action to revise ex-gratia in terms of these provisions shall be initiated by the concerned Heads of Departments. In the case of the Defence Civilian Employees, however, the procedure prescribed in this regard by the Ministry of Defence shall be followed. It is emphasised that the Sanctioning Authority, in no case, will ask the beneficiary to surrender higher original Ex-gratia Payment Order (EPO) for issuing revised authority.

8. The CPF beneficiaries may send applications to the Head of Office and/or Disbursing Authority concerned for revision of ex-gralia amount indicating the EPO details and the office from which he/she retired/last served. The Disbursing Authority shall intimate the details of the beneficiaries to the Central Pension Accounting Office and the Pay & Accounts Offices concerned in the proforma enclosed as Annexure to this O.M.

9. The periodical certificates such as life certificate, non-employment certificate etc. prescribed for drawal of pension will also be required to be submitted by the recipient of the ex-gratia payment to the appropriate disbursing authorities for drawl of ex-gratia.

10. These orders apply to all civilian Central Government employees covered under contributory Provident Fund scheme retired/died before 1986, including civilians paid from Defence Service Estimates but will not apply to Railway Employees. Separate orders will be issued by the Ministry of Railways (Railway Board) for revision of ex-gratia payable to the dependent members of Families of eligible employees covered under the State Railways Provident Fund (Contributory).

11. In their application to the persons belonging to Indian Audit and Accounts Department these orders issue in consultation with the Comptroller and Auditor of India

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(Sujasha Chodhury)

Deputy Secretary

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Returns on NPS or DCPS Schems for Financial Year 2012-13.

The National Pension System (NPS) regulated by Pension Fund Regulatory and Development Authority (PFRDA) has delivered double digit returns for the financial year 2012-13 and has evidenced itself as not just being the cheapest retirement product but also as the highest returns generating scheme.

PFRDA advises that various NPS schemes have earned the following average annual returns during the financial year recently ended on 31st March, 2013 (Weighted Average):

Details are as under:

Sr. No.	Scheme	Average returns (in %)
1	Central Government	12.39
2	State Government	13.00
3	Swavlamban	13.40
4	Private: Equity	8.38
5	Private: Corporate Debt	14.19
6	Private: Government Debt	13.52

Last year PFRDA had issued revised guidelines for Registration of Pension Fund Managers to manage NPS for Private sector, under which eight Pension Fund Managers have been registered so far- SBI Pension Funds Pvt. Ltd., UTI Retirement Solutions Ltd., LIC Pension Fund Ltd., Kotak Mahindra Pension Fund Ltd., Reliance Capital Pension Fund Ltd., ICICI Prudential Pension Funds Management Co. Ltd., HDFC Pension Management Co. Ltd. and DSP Black Rock Pension Fund Managers Pvt. Ltd.

Pension Fund Managers are now allowed to prescribe their own fee subject to ceiling of 0.25% to enable an economically viable model for their operations.

PFRDA also recently revised its Investment Guidelines, with a view to improve performance of Pension Fund Managers by direct investment in equity & corporate debt and not through mutual funds etc. Further for better risk management prudential sectoral norms have also been introduced.

The National Pension System which was introduced by the Central Government in January 2004 for its new entrants and subsequently extended to the private sector in May 2009 has accumulated a corpus of Rs 33,000 crores contributed by 50 lakhs subscribers.

 

Source: www.90paisa.blogspot.in

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