National pension scheme Sadashiv Patil. Asst. Professor, YASHADA.

Defined Contribution Pension Scheme: DCPS Government Resolution No.CPS-1005/ 126/SER-4, Dated 31st October, 2005 Defined Contribution Pension Scheme would be made applicable to the Government servants who are recruited on or after 1st November 2005 in State Government Service. On the lines of Government of India, State Govt. replaced the existing pension scheme. The Government is also pleased to decide that the provisions of, (i) the existing pension scheme (i.e. Maharashtra Civil Services (Pension) Rules, 1982 and Maharashtra Civil Services (Commutation of Pension) Rules, 1984 and (ii) the existing General Provident Fund Scheme (GPF) would not be applicable to the Government servants who are recruited on or after 1st November 2005 in State Government service.

SALIENT FEATURES OF THE NEW PENSION SCHEME This scheme shall be called as " Defined Contribution Pension Scheme". This scheme will come into force with effect from 1st November 2005. The New Contribution Pension Scheme will be mandatory for all the Government servants who are recruited on or after 1st November 2005 in State Government service. The new contribution pension Scheme will be based on defined contribution and will have two tiers, i.e. - Tier-I & Tier-II. Tier-I will be mandatory for all the Government servants who will be recruited on or after 1st November 2005 in State Government service whereas Tier-II will be optional for them and at their discretion

Tier I & Tier II Tier-I: every Government servant will have to make a monthly contribution at 10% of his "Basic Pay plus Dearness Pay (if any) plus Dearness Allowance", which will be deducted from his salary bill every month. The State Government will make an equal matching contribution. The contributions and the investment returns will be kept in a nonwithdrawable "Pension Tier-I Account.” Tier-II: each Government servant, in addition to the above mentioned Pension Tier-I Account, will also have a "Voluntary Tier - II withdrawable Account" at his option. Contribution made by the Government servant will be kept in such separate account and that will be withdrawable at the option of the Government servant. However, Government will not make any contribution in this account.

APPLICABILITY OF THE SCHEME To Government servants who are recruited on or after 1st November 2005 in State Government service. To whom the existing pension scheme and General Provident Fund Scheme is applicable. Shall apply to the employees, who are recruited on or after 1st November 2005 in the services of Zilla Parishad.

Implementation of DCPS G R Dated 07/07/2007 Matter regarding establishment of CRKA & Pension Fund Managers was under consideration of Central Govt. Interim arrangement for implementation of DCPS. State Record Keeping Agency[SRKA] is formed under administrative control of DAT. SRKA will maintain the Account & related record. Contribution- TIER I- 10%of Pay+DP+DA Later– 10% of Pay[pay+GP]+DA Implementation of TIER II is pending till further orders.

ROLE Of SRKA Collection of information of employee in Form-1. Allotment of Pension Account Number Recovery of contribution. Consolidation of information. Form R-3 Interest calculation. Annual Statements.

National Pension scheme Government Resolution No.: Aniyo- 2015/(NPS)/C.R.32/Seva-4 Dt 6Th April 2015 The State Government has joined the National Pension Scheme of the Central Government vide This GR. Defined Contribution Pension Scheme has now been renamed as “National Pension Scheme” (NPS).

Agreements Between the State Government & National Pension Scheme Trust (NPS Trust) established by the Government of India. Between the State Government & National Securities Depositories Limited- e-Governance Infrastructure Limited (NSDL) NSDL has been appointed as the Central Record Keeping Agency (CRA) by the Government of India.

Benefits of nps Dual benefit of Low Cost & Power of Compounding. Pension wealth accumulates over a period of time till retirement; grows with a compounding effect & account maintenance charges being low. Tax benefits: IT Act 1961, 80CCD(1) & 80CCD(2). Safety: Regulated by PFRDA & introduced by the Govt. of India. Transparency: Through online access to your pension account. Portability: Across all geographical locations & employments across India.

Investments of NPS Contributions Contributions are allocated to three Public Sector Pension Fund Managers. SBI Pension Funds Private Limited--33% UTI Retirement Solutions Limited---34% LIC Pension Fund Ltd.------------------33% Investment Proportion: Up to 55% in Government Securities, Up to 40% in Debt Securities, Up to 15% in Equity & Upto5% in Money Market instruments.

NPS Applicability To all the employees of the State Government who join Government Service on or after dt.01/11/2005 AIS (All India Services) Officers who join the Government of India on or after dt.01/01/2004 and who are allotted the Maharashtra cadre. NPS is not applicable if the employee is appointed in any other manner (e.g., on contract basis, for a limited period, tenure period, against a project, or any other irregular manner) than regular, recognized mode of appointment.

Central Recordkeeping Stakeholders in NPS PFRDA Subscribers ASP Nodal Office Central Recordkeeping Agency PFRDA: The regulator of NPS. CRA: The nerve centre of the NPS architecture. Responsible for maintaining records of individual subscriber transactions across the country. Develop and maintain the system as per the guidelines issued by PFRDA. Trustee Bank: An entity with the capability of handling financial transactions in the NPS. Is responsible for receiving money from the POP-SP and transfer the same to the PFM as per the choice given the subscriber. PFM(s), have been appointed by Pension Funds Regulatory & Development Authority (PFRDA) to manage the subscriber’s pension fund contributions by investing the same in various schemes. PFM(s) and the various schemes offered by these PFM(s) will be registered in CRA system. PFMs will allot units based on NAV as applicable and provide this information to CRA. Subscribers will have the option to invest their contributions amount into one or more schemes registered in CRA system. The GOI has rolled out the NPS for all citizens from 1st May 2009. Various facilities (like opening Permanent Retirement Account, contributing to NPS etc) will be required to be provided to all the citizens (known as ‘Subscribers’ in the NPS architecture) at various locations across India. These processes shall be carried out through the entities known as Points of Presence (POPs) appointed by the PFRDA. POPs’ shall provide the services under NPS through their network of branches called POP Service Providers (POP-SP). ASP – Annuity Service Provider -yet to be appointed by PFRDA. Custodian – maintains the assets purchases by PFMs on behalf of the subscribers Custodian Trustee Bank PFM 1-32

About PFRDA Regulatory Authority for NPS Architect of NPS features Appointment of entities of NPS architecture Formation of NPS Trust Registered owner of all assets under the NPS architecture Regulate and monitor the performances of the entities PRFRDA was established in order to formalise the NPS and ensure that excellent service delivery is assured to the subscriber with the lowest possible costs. PFRDA is the regulator as IRDA to Insurance and SEBI to Securities market. To ensure that there is adequate transparency in the system To ensure that the grievance raised by the entities and the subscribers are addressed and resolved in the shortest possible time To ensure that professional entities are appointed to manage the information flow and fund flow in the NPS system i.e., entities specialised in each activity have been entrusted with that activity in NPS. Appointment of NPS Trust -in order to monitor the performance of various entities. 1-32

The Central Record Keeping agency---- cra NSDL is appointed as CRA by PFRDA. Central Record Keeping Agency (CRA)shall be responsible for the allotment of Permanent Retirement Account Number (PRAN) Shall be responsible for maintenance of accounts of all the employees and all other duties assigned by the PFRDA with respect to the NPS. Shall carryout all the responsibilities as enumerated in the agreement between them and the State Government.

Registration Registration of State Nodal Officer (SNO) Registration of Treasury Officers (DTO) Registration of Drawing and Disbursing Officer (DDO) Registration of employees under the National Pension Scheme

How to open a Permanent Retirement Account? Approach the Treasury Office/DDO and procure the PRAN application form i.e. CSRF form. Fill up the mandatory fields. PRAN generated and PRAN card is dispatched to the Treasury office. Procure your PRAN application form: As a Subscriber between the age bracket of 18 to 60 years of age, you can procure your PRAN application form from any of the POP-SPs you wish to register with. You can locate your nearest POP-SP by navigating to the CRA website www.npscan.nsdl.co.in. You can also procure the PRAN application form from our website Fill up the PRAN application form: You have to ensure that your PRAN application form is filled up i.e. photograph, signature, mandatory details, scheme preference details etc and also submit KYC documentation w.r.t to proof of Id and proof of address. You are advised to read the instructions given at the back of the form. For detailed information on NPS, please refer to the offer document prescribed by the Pension Fund Regulatory and Development Authority (PFRDA). Submit PRAN application form to POP-SP: You can go to your nearest POP-SP and submit the PRAN application along with the KYC documents. Expect your PRAN card within 15 days. Submit your first Contribution Slip: You are required to make your first contribution (minimum of Rs 500) at the time of applying for registration to any POP-SP. For this, you will have to submit NCIS (Instruction Slip) mentioning the details of the payment made towards your PRAN account. 1-32

Subscriber Registration Section A - Personal Details (Mandatory-) Name of the subscriber Present Address Phone No. Mobile No, & Email ID Subscriber’s Bank Details Section B - Employment Details (Mandatory) PPAN/Unique employee Id Number DTO Registration Number and DDO Registration Number Ratify overwriting / striking off of any of the employment details

Subscriber Registration Section C - Nomination Details (Optional) Nominate maximum of three persons as nominees Sum of percentage share across all the nominees must be equal to 100 Section D - Scheme details Nominate maximum of three persons as nominees. Subscriber should provide the scheme name, PFM name and percentage allocation for that scheme.

Subscriber Registration Submission of PRAN application form to the DDO/DTO. DTO submits forms to the CRA after due scrutiny. Issuance of receipt number by CRA as acknowledgement to track the status of application Generation of PRAN by CRA Dispatch of PRAN kit and I-PIN/T-PIN by CRA In a nutshell to sum it up, Subscriber has to submit the application form to the POP-SP of his/his choice The POP-SP shall be responsible for issuing a 17 digit receipt number which shall be helpful to track the status of the application in the CRA system. Importance of receipt no. Once the application is received by the POP-SP, the CRA shall generate PRAN and send the PRAN kit consisting of PRAN card, NPS brochure etc to the subscriber within twenty days of submission of forms to the CRA-FC. TAT to receive PRAN Kit-around 20 days. PRAN kit dispatched first & then, PIN mailer. If some one asks about ISEC online model– to say about no PRAN card & only PIN mailer initially. PRAN card can be procured by submitting application subsequently. 1-32

7. Generation & dispatch of PRAN card, I – Pin Subscribers Registration Subscriber 1. Submission of Form 9. PRAN kit 2. Verification of details, provide employment details, Consolidation and Submission DTO DDO 4. Generate PRN and/or Rejection Letter 3. Submission of forms 7. Generation & dispatch of PRAN card, I – Pin & T - Pin CRA 5. Scanning & digitization of Forms CRA-FC 6. Verification through FVU and Upload NPSCAN 10. Data Download

Grant of Permanent Retirement Account Number (PRAN) by the CRA After receipt of employee information in Form CSRF, the CRA shall allot PRAN to such employee. A PRAN kit shall also be given to such employee through DDO. Every employee shall verify the details in PRAN kit, accuracy of the information therein and confirm availability of T-PIN (Telephonic Personal Identification Number) and I-PIN (Internet Personal Identification Number). In case of any problem, the employee shall directly contact the CRA. PRAN Number once allotted shall never change even when the employee is shifted to any other office due to promotion, demotion, transfer, deputation or any other reason.

Handling of I- PIN & T-PIN You can use the I-PIN for the following: Checking the status of your application for change of details submitted to Treasury office. View your statement of transactions (SOT)online Logging of complaints against any entity in NPS and track its status You can use your T-PIN for the following: Status of application for change of details submitted to Treasury. Account balance, holding & scheme details Logging of complaints against any entity in NPS and track its status If the I-Pin is entered wrongly more than 5 times, the I-Pin gets blocked. In such cases, the subscriber can answer the secret question set by him/her at the time of first login and reset the I-Pin online. This also can be attempted for 5 times. There is no need for the subscriber to get into a dialogue either with the POP-SP or with the CRA in order to get the I-Pin reset. However, for reissue – POP-SP to be contacted. First login using I-Pin within 60 days. IVR – using T pin subscriber can access the IVR. Subscriber can get various details such as, balances, scheme preference ratio, withdrawal details etc. 22 NSDL-CRA 1-32

‘ PRAN CARD VIEW

Employees of the State Government who joined service before dt. 01. 04 The employees who are already registered under the DCPS and are assigned Permanent Pension Account Number (PPAN) shall fill the required information in Form CSRF prescribed by the PFRDA & it shall be handed over to the DDO The DDO shall forward immediately the CSRF Forms as and when they are received from Employees. The DTO shall send the forms received by him immediately to the CRA. The CRA shall allot Permanent Retirement Account Number (PRAN) to these employees.

Employees of the State Government who join service on or after 01/04/2015 The information of these employees who join service on or after 01/04/2015, shall be entered in the Sevaarth Application by the DDO himself. The said CSRF Form shall be available to the concerned DTO in the Sevaarth Application. The DTO shall approve the Form on the Sevaarth Application. No printed copy of such CSRF Form shall be sent to the DTO. After the DTO approves the Form,a DCPS No. i.e. PPAN will be generated by the Sevaarth Application. The DTO shall forward such application in CSRF Form to the CRA.

Deputation of an employee of the State Government Cadre Controlling Authority shall prepare the CSRF form for such employee and send it to the concerned DTO, in whose jurisdiction such office of the Cadre Controlling Authority is located. The DTO shall forward such application in CSRF Form to the CRA. The CRA shall allot a PRAN to the employee and communicate the same to the Cadre Controlling Authority.

Procedure for Employees on Deputation AIS The officers who have been assigned PRAN through SRKA till now shall not be required to do anything. But the officers those who join on or after 01/04/2015 the DDO of the said office need to enter all the details of such officer in Form CSRF in Sevaarth system. If already having PRAN assigned by CRA then they shall follow the guidelines available on the web site of the CRA to find out whether the PRAN is IRA compliant or not and take necessary action to make it IRA compliant. The concerned Assistant Nodal officer shall be responsible to deduct regular contributions as well as employer contributions for an AIS officer joining the deputation post in a deputee organization owned or controlled by State Govt. on or after 01/04/2015 and who do not have PRAN.

Deduction of monthly contribution Deduction on account of employee’s contribution and equal amount of employer’s contribution under the NPS shall be made simultaneously through salary bill. It shall be the duty of the DDO to ensure that the contribution of the employee and the employer are compulsorily made on a monthly basis. DTO shall draw these amounts from the Treasury & the amount shall be sent to the Trustee Bank. All the DTOs and the Pay & Accounts officer in Mumbai are hereby authorized as DDOs for this purpose.

Procedure for Employees on Deputation The concern organization will deduct the monthly contribution of that concerned Employee The Contribution along with the employer’s contribution shall be sent to the concerned DTO in the form of DD. The DTO shall be responsible for maintaining the accounts of all such contributions received from DDOs.

Subscription amount is to be deposited in the Trustee Bank PFRDA has appointed Axis Bank as the “Trustee Bank” for NPS for the Government of Maharashtra. The Trustee Bank would be the Bank notified as such by the PFRDA from time to time. Trustee Bank shall transfer such amount for investment to the Pension Fund Manager(PFM) appointed by the PFRDA and nominated by the State Government

Role of dto about transfering amount in the Trustee Bank It shall be the duty of the DDO to deduct employee’s contribution and draw employer’s monthly contribution under NPS & send it to DTO through salary bill. DTO shall draw these amounts from the Treasury, by preferring a bill in the simple receipt Form-45A. DTO is declared DDO for this purpose. SCF- Subscribers Contribution File. After generating SCF, DTO get Transaction ID. SCF shall be uploaded to CRA before the date of 25th for 1 to 18 days & before 10th of next month for 19 to 30/31.

Role of dto about transfering amount in the Trustee Bank…….. Continue… The DTO shall transfer the total amount of contribution (employees’ subscriptions and employer’s subscriptions) to this bank along with Transaction ID. Transfer procedure should be done before the completion of 5 days from uploading SCF. Means before before 30 of the month for 1 to 18 & before 15 of next month for 19 to 31/31. All these contributions (employee’s and employer’s) are meant to be invested by the PFMs designated for the purpose and as time is of the essence, these time limits shall be strictly observed by the DTOs

Reconciliation DTO is responsible for reconciliation of all transactions with Trustee bank in every month & every quarter. DDO is responsible for reconciliation with Treasury.

in case of excess contribution / less contribution being made under NPS The DDO shall be responsible for ensuring that only the prescribed 10 % (Basic pay + D.A. thereon) is deducted from the employee and equal 10 % given as employer's contribution. In cases where excess contribution has been made into the employees account, the excess amount should be adjusted in the subsequent month(s). It is the responsibility of the employee to check the contributions in his NPS account on a monthly basis and report any discrepancies to the DDO in writing. The employee who has not been diligent in this regard cannot later on litigate in this matter.

Statement of transaction- SOT SOT contains all details of transactions carried out in your pension account. CRA sends a copy of the SOT annually to your mailing address registered with CRA. Details of contribution amount invested & units allocated during the financial year, unit holding as on date, any changes in your PRAN details etc. You can access your SOT through CRA website using your I-Pin.

Service Charges CRA shall charge service charges for the services rendered by them as per the terms of the agreement between the State Government and the CRA. The service charges shall be paid by the SRKA on a quarterly basis

Regulation: Redressal of Subscriber Grievance You can raise the grievance/complaint through CRA call centre using T-Pin OR through CRA website using I-Pin. Redressal of Subscriber Grievances Regulation 2015. A filled G-1 form may also be sent to CRA for lodging a grievance. Every grievance should be disposed off within a period of 30 days of its receipt. CGMS: Central Grievances Management Utility of CRA Portal. Final reply should be provided to the complainant, containing details of resolution or rejection of the complaint, with the proper and justifiable reasons in writing.

Regulation: Redressal of Subscriber Grievance Monetary Implications if grievance is not resolved within 30 days: (a) As per the provision of regulation no. 25 of the draft PFRDA (Redressal of Subscriber Grievance) Regulations, 2015. (b) The unresolved grievances can be escalated to NPS Trust and further to the Ombudsman by the subscriber. (c ) In the event, the matter is not resolved within the stipulated period, the Ombudsman, has the power to give directions or orders as considered appropriate including compensation and interest up to sum of rupees 10 lakh.

Lump sum % (Maximum allowed) Annuity % (Minimum allowed) Exit from Scheme Category Lump sum % (Maximum allowed) Annuity % (Minimum allowed) Superannuation* 60% 40% Premature 20% 80% Death 100% - * In case of corpus below Rs. 2Lacs 100% withdrawal is allowed

ASP ASP- Annuity Service Provider. Annuity provides for monthly pay-outs to the individual in lieu of the lump sum amount paid to the ASP from NSP as per percentage specified by subscriber at the time of exit. Annuity Service Provider & Annuity Scheme shall be provided strictly in accordance by choice made by subscriber at the time of exit from NPS.

ASP Options Bajaj Allianz Life Insurance Co. Ltd. HDFC Life Insurance Co. Limited ICICI Prudential Life Insurance Co. Ltd. Life Insurance Corporation of India Reliance Life Insurance Co. Ltd. SBI Life Insurance Co. Ltd. Star Union Dai-ichi Life Insurance Co. Ltd.

Withdrawal Not possible up to 10 years form beginning. After 10 years, 25% of your contribution only This should be for Important reasons. For e.g.. Marriage, Education etc. Withdrawal if only for 3 times in total service after 10 years.

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