Wednesday, September 4, 2013

लीजिये,पेंशन का भी हो गया बंटाधार आदमजाद नंगे हो गये,अब घूमे बाजार यह देश तो एफडीआई हुआ भइया देखना कुछ भी अनबिका न रहे भइया Indian economy has a 'bright future', says new RBI chief Raghuram Rajan

लीजिये,पेंशन का भी हो गया बंटाधार

आदमजाद नंगे हो गये,अब घूमे बाजार

यह देश तो एफडीआई हुआ भइया

देखना कुछ भी अनबिका न रहे भइया

Indian economy has a 'bright future', says new RBI chief Raghuram Rajan



पलाश विश्वास


कैबिनेट द्वारा मंजूर पेंशन निधि नियामक एवं विकास प्राधिकरण विधेयक में पेंशन क्षेत्र में विदेशी निवेश का प्रावधान है। बीमा कानून (संशोधन) विधेयक बीमा क्षेत्र में विदेशी निवेश की सीमा 26 से बढ़ाकर 49 प्रतिशत करने का प्रस्ताव करता है।


  1. News for pension india

    1. Lok Sabha passes Pension Bill

    2. Times of India ‎- 1 hour ago

    3. The long-pending Pension Bill, a key economic legislation assuring minimum returns to subscribers, was today approved by the Lok Sabha.

    4. After deadlock ends, Lok Sabha passes Pension Bill

    5. Daily News & Analysis‎ - 1 hour ago

    6. Lok Sabha passes pension overhaul, foreign investors wary

    7. Reuters India‎ - 11 minutes ago



निवेशकों की आस्था सही सलामत है

कारपोरेट लाबिइंग सही सलामत है

सही सलामत है कारपोरेट राजनीति

हम अब कब होंगे सही सलामत

इसकी मनाते रहिये खैर भइया


चीखते रहे हैं हम लगातार

चीखते रहे हैं हम लगातार

1991 से दो दशक तक

उससे भी पहले

चीख चीखकर हम मांगते रहे

भूमि सुधार, बदले में मिल गये

आर्थिक सुधार और सिर्फ आर्थिक सुधार


जोर का झटका धीमे से लगता है

बवासीर देश का रक्तपात

बुझाता नहीं किसी को भइया

जो कुछ बहता है वह

आखिर स्वजनों के खून के

सिवाय कुछ नहीं है भइया


कितनी बार चीखे हम

तोड़ दो तिलिस्म यह

निकलो भूलभुलेय्या से बाहर

निकलो कर्मकांड से बाहर

हम चीखते रहे जाति उन्मूलन के लिए

आप उलझ गये अस्मिताओं और पहचान में

हमने मांगा,संविदान हो लागू

लागू हो जाये कानून का राज

बहला रहे लोकतंत्र

आप हमारे स्वजन

उलझ गये सत्ता में भागीदारी

की आत्मघाती राजनीति में

आप बन गये

जाति वर्चस्व और खुले बाजार के

झंडे वरदार एक से बढ़कर एक


हमने चीखा,अस्पृश्य भूगोल को

देश के नक्शे में करो शामिल

हो सके तो भइया

जोड़ सको तो जोड़ो देश भइया


आप देश तोड़ने वालों के साथ

खड़े हो गये भइया


हम बेकार ही चिल्लाते रहे

हो सके तो भइया

हमारे साथ खड़े हो जाओ भइया


अब का होई

जब चिड़िया चुग गयी खेत

होइहिं सोई जो

अमेरिका रचि राखा

चुनरी में लग दाग

चोर निकलकर भागा


अंधभक्तों के धर्मोन्मादी देश में

सबकुछ अब धर्म है

सारे देवता अब आशाराम


लोग हमारे मरे थोक भाव से

वे पूजा का आयोजन करें

आयोजन करें धर्मस्थलों के विध्वंस का

फिर जीर्मोद्धार का भी आयोजन

वही लोग करें भइया

खून की नदियों में हम तो

बसे पुण्यस्नान ही करें भइया


हम इज्जत का सौदा करते लोग

मूर्तियों की पूजा में निष्णात

अपने अपने देवता

अपनी अपनी देवी

की पैदल सेनाएं हैं हम


कितनी दफा तो हम चीख चीखकर

लगाते रहे गुहार

सिंहद्वार पर दस्तक बहुत तेज है

जाग सको तो जाग जाओ भइया

ले लंगोटी भाग रहा है भूत

पकड़ सको तो पकड़ लो भइया


वेतन,जमा पूंजी, भविष्य निधि

पेंशन बीमा सबकुछ अब बाजार


जीवन भी हुआ खुला बाजर,भइया

मोल भाव नाप तौल मे ंहुए

अनाड़ी तो बेमौत मारे जाओगे भइया


खेत हो गये बेदखल,गांव हुए बेदखल

बेदखल हो गयी हरियाली

हम लोग नकली हरियाली में जीते रहे

हम लोग कृत्तिम घास खाते रहे


अनाज से बेदखल हम चाउमिन चबाते रहे

अब फास्ट फुड हो गया जीवन


सास लगाकर या चटनी से चाटो भइया

मुंह में डाल लो उनका गाजर भरपूर

कान में ठूंस लो जिगंल भइया

उठा लो सिलबट्टा

चटनी बनाकर मौज से रहो भइया

चाटते रहो चटनी चौबीसों घंटे भइया

बाप मरे चाहे मर जाये दइया


बच्चों को लावारिश छोड़ दो

मुफ्त खिचड़ी की पांत में

या क्लास रुम ही ग्रुप सेक्स का

प्रयोग चलने दो भइया


खाद्य सुरक्षा की हरित क्रांति

का जो भी हुआ हो भइया

नीली क्रांति की जय जयकार भइया

आपात अम्मा की जय जयकार भइया

अबाध वंशवाद, नस्लवाद की जय जय भइया

अबाध अस्पृश्यता, अबाध बहिस्कार

और अबाध नरसंहार

ये ही हैं आर्थिक सुधार भइया


जयकारा उनका भी लगा लो भइया

खींसे में धरै नहीं पइसा

गरीबी हटाओ में हो जाओ शामिल भइया

फिर कमाओ अंधाधुंध भइया

यही आर्थिक सुधार है भइया


अम्मा के नाम जोर से लगाओ जयकारा

धर्मोन्मादी जिहाद में

स्वजनों का खून बहा दो

यही आर्थिक सुधार है भइया



देशद्रोहियों को खुलेआम

यह देश बेचने दो


देख लो भइया

अनबिका कुछ न रहे


रुपया गिर रहा है

अनबिका  कुछ न रहे


वित्तीय  घाटा बेलगाम है

भुगतान असंतुलन है भयंकर

अनबिका कुछ न रहे

यही आर्थिक सुधार है भइया



विश्वबैंक का फतवा है

मुद्राकोष का हुक्म है

खबरदार, अनबिका कुछ न रहे

रेटिंग संस्थाएं चिल्लातीं बार बार

अनबिका कुछ न रहे


हम लगातार चीखते रहे

आर्थिक कोई संकट है नहीं

मृत्युभोज का देश यह

अपनी ही मौत की दावत में

जूठन नोंचने वाले लोग यहां

यही आर्थिक सुधार है भइया



लाखों की रैलियों में

प्रवचन का देश यह

हजार अस्मिताओं में बंटा देश यह

अब इस देश को बिक जाने दो

सलामत रहे निवेशकों की आस्था

यही आर्थिक सुधार है भइया



अपने अपने परिजनों पर भी

अब प्रत्यक्ष विदेशी निवेश

लगने पर भी हमें ऐतराज कहां

यही आर्थिक सुधार है भइया


यह देश तो एफडीआई हुआ

कुछ भीनहीं अब बिका न हुआ

प्रवचन सुनते सुनते

बहसें देखते देखते

रैलियों में नारे लगाते

बीत गये दो दशक पूरे

यही आर्थिक सुधार है भइया



कभी किसी ने इस आर्थिक दुश्चक्र

को तोढ़ने की कोशिश कहां की भइया

इस तिलिस्म के हम हो गये पहरेदार भइया

बाकी जो बचा वह बाजार का भूल भूलैय्या

यही आर्थिक सुधार है भइया



कितना बार चीखते रहे हम

साथी हाथ बढ़ाना

कोई फर्क नहीं है हममें तुममें

जो तेरी कथा है

वही मेरी व्यथा है

बीच में डाली अस्मिताओं की दीवार

हम हुए नहीं एकजुट

बाजार के सारे दल्ला हो गये एकजुट

सर्वत्र उन्हींका कब्जा भइया

यही आर्थिक सुधार है भइया



विरोध के लिए करते हैं विरोध

बाकी सब दिखावा है

कार्यवाही में कहीं साजिश

की कोई खुशबू नहीं है

हत्या हो या नरसंहर

कहीं नहीं है कातिल

का कोई सुराग

कत्ल हुए संविधान का

कहीं नहीं है कोई निशान

न कानून का राज है

यही आर्थिक सुधार है भइया



समता और सामाजिक न्याय

चिल्लाते रहे

तानाशाहों के द्वीपों में कैद अलग अलग

विचारमंथन में करते रहे क्रांतियां

वे फेंकते रहे भ्रांतियों का जाल

यही आर्थिक सुधार है भइया



वैसी ही भ्रांति का भंवर है

आर्थिक सुधार

महालक्ष्मी यंत्र है आर्थिक सुधार

कुंडली है आर्थिक सुधार

पवित्र धर्म ग्रंथ है

आर्थिक सुधार


कारपोरेट राज में

आर्थिक सुधारों के खिलाफ

बोलना मना है

लिखना मना है

यही आर्थिक सुधार है भइया



तमाम दक्ष कारीगगर

हमें जिंदा दीवालों में चुन रहे हैं

कब्रिस्तान में भी हम

थ्री जी फोर जी स्पेक्ट्रम भइया

चैनल हैं सैकड़ों पर

कहीं हमारी हत्या की

कोई खबर नहीं है

यही आर्थिक सुधार है भइया


हमारे जो भी लोग हैं

जिनको हमने चुना

उन्होंन हमें जमकर लगाया चूना

अब इस चूने पर लगा लो कोई भी रंग

यही आर्थिक सुधार है भइया



महामहिम कालजयी तमाम

मुर्दाफरोश हैं इन दिनों

बिंब संयोजन और सौंदर्यबोध में

निष्णात हमारी मेधा

विधायों और व्याकरण में

वर्तनी में कैद

बेआवाज हमारी आवाज भइया

यही आर्थिक सुधार है भइया



किसी को होश नहीं है विदेशी निवेश

के खोल दिये सारे दरवाजे

दावानल से बच निकलने

के सारे रास्ते बंद हैं

बंद हुए जिजीविषा के सारे द्वार

यही आर्थिक सुधार है भइया



आत्महत्या एकमात्र विकल्प है

या विकल्प है मारे जाने का इंतजार

धर्मप्राण हम समर्पित हैं

इहलोक हुआ तबाह तो क्या

परलोक परमार्थ है

अस्पृश्य सिर्फ सिद्धार्थ है

यही आर्थिक सुधार है भइया




अब आपात काल नहीं है

आपात अम्मा का फिरभी जयकारा है

चारों तरफ अम्मा जागरण का शोर

चप्पे चप्पे में जेबकतरों की बस्तियां

चप्पे  चप्पे चप्पे में घात लगाकर बैठे चोर

देशभर में हर कहीं अब भूमि डकैतों का जोर


आपात काल नहीं है

चारों ओर कार्निवाल है

आईपीएल है, गली मोहल्लों में बार है

गली गली शराब की दुकान है

हर मोहल्ले में शापिंग माल है

यही आर्थिक सुधार है भइया


हर घर में प्रोमोटर राज है

कैसिनो हुआ देश अब

सांड़ों और भालुओं के हवाले हैं

भाषण से राशन सटोरियों के हवाले हैं

यही आर्थिक सुधार है


आपातकाल में भी हमने देखे

कालिख पुते पन्ने तमाम

हमने देखे बिना संपादकीय के अखबार

वे लड़ाके कहां हो गये कि

बिना प्रतिरोध बिक गये हम सारे

बिक गया सारा देश भइया

आपातकाल नहीं है

लेकिन सबको सांप सूंघ गया है

या फिर बेमतलब हंगामे में

मुद्दे दरकिनार करने का रिवाज है

हम तो भये हद दर्जे के चूतिया भइया

डिजीटल हुए हम, हो गये बायोमेट्रिक

यही आर्थिक सुधार है भइया



करोड़ों हमारे स्वजन आनलाइन हैं

लाइक करने के सिवाय

बेमतलब पोस्ट डालने के सिवाय

हत्यारों के हक में मुहिम चलाने के सिवाय

धर्मांधता प्रसारित करने  के सिवाय

बोल दो,क्या करे रहे हमारे स्वजन भइया

यही आर्थिक सुधार है भइया



आपात काल नहीं है

दरवाजे पहले से बंद हैं

अखबार कुछ नहीं छापते

चीखते चैनलों में दर्शनीय के अलावा

बाइट धुंआधार और सनसनीखेज के अलावा

हमारी चौतरफा तबाही की कोई खबर नहीं होती

हमने जो खोली थी खिड़कियां

धर्मांतरित हेने लगी हैं वे खिड़कियां

यही आर्थिक सुधार है भइया



जो रह गयी हमारी, एक एक कर

बंद होने लगी हमारी वे खिड़कियां

यही आर्थिक सुधार है भइया



जाग सको तो जाग जाओ भइया

सिंहद्वार पर दस्तक बहुत तेज है भइया

यही आर्थिक सुधार है भइया



लीजिये,पेंशन का भी हो गया बंटाधार

आदमजाद नंगे हो गये,अब घूमे बाजार

यह देश तो एफडीआई हुआ भइया

यही आर्थिक सुधार है भइया







पेंशन निधि नियामक और विकास प्राधिकरण (पीएफआरडीए) को वैधानिक दर्जा देने के लिए बहुप्रतीक्षित विधेयक बुधवार को लोकसभा में पास हो गया। सदन ने पेंशन निधि नियामक और विकास प्राधिकरण विधेयक 2011 को 33 के मुकाबले 174 मतों से पारित कर दिया। विपक्ष के संशोधनों में कुछ को मत विभाजन के जरिए और बाकी को ध्वनिमत से अस्वीकार कर दिया गया। पीएफआरडीए गठन वर्ष 2003 में किया गया था और इस विधेयक के पारित होने से उसे वैधानिक दर्जा मिल जाएगा। विधेयक राष्ट्रीय पेंशन प्रणाली के अलावा उन सभी पेंशन प्रणालियों पर भी लागू होगा जो किसी अन्य कानून से विनियमित नहीं होती हैं।

सरकार की मानें तो बिल पास होने से सरकार की पैसों की जरूरत आसानी से पूरी हो जाएगी। इसके अलावा, लंबी अवधि के लिए लोन मिलने में मदद मिलेगी। इसके जरिए बाजार में पूंजी की कमी को पूरा किया जा सकता है ताकि अर्थव्यवस्था में तेजी आ सके। 26 फीसदी एफडीआई के जरिए विदेश से ज्यादा पैसा भी आ सकता है। इंफ्रास्ट्रक्चर में अधिक निवेश का अवसर मिल सकता है।

ये बिल पिछले नौ साल से लटका हुआ था। वित्त मंत्री पी. चिदंबरम ने इसे आज लोकसभा में पेश किया। पेंशन बिल को 24 मार्च 2011 को भी लोकसभा में पेश किया गया था। इसके बाद इसे वित्तीय मामलों पर बनी स्थाई समिति को भेजा गया। सरकार ने 2005 में भी इसी तरह का बिल पेश किया था, लेकिन वो बिल पास नहीं हो सका था।

पेंशन क्षेत्र में प्रत्यक्ष विदेशी निवेश को कैबिनेट की मंजूरी

Bhasha, Last Updated: अक्टूबर 5, 2012 01:00 AM IST

नई दिल्ली: सरकार ने पेंशन निधि में विदेशी निवेश को गुरुवार को हरी झंडी दे दी। उसका कहना है कि विदेशी निवेश की यह सीमा बीमा क्षेत्र की तरह 49 प्रतिशत तक जा सकती है।


प्रधानमंत्री मनमोहन सिंह की अध्यक्षता में हुई केन्द्रीय मंत्रिमंडल की बैठक में पेंशन निधि नियामक एवं विकास प्राधिकरण (पीएफआरडीए) विधेयक को मंजूरी दे दी गई।


बैठक के बाद वित्तमंत्री पी चिंदबरम ने बताया कि विधेयक को मार्च 2011 में लोकसभा में पेश किया गया था। उसके बाद वित्त संबंधी संसद की स्थायी समिति ने पिछले साल सितंबर में अपनी सिफारिशें दीं।


उन्होंने कहा कि पेंशन में विदेशी निवेश की सीमा बीमा क्षेत्र में विदेशी निवेश की सीमा के अनुरूप ही होगी। यदि बीमा विधेयक पारित हुआ और विदेशी निवेश की सीमा 49 फीसदी रही तो पेंशन क्षेत्र में यह 49 प्रतिशत रहेगा।


विधेयक पेंशन निधि में होने वाले निवेश के कुछ हिस्से का निवेश शेयर बाजार में करने का प्रस्ताव करता है। विधेयक को संसद के आगामी शीतकालीन सत्र में पेश किये जाने की संभावना है।


मूल विधेयक में विदेशी निवेश को लेकर कोई प्रावधान नहीं है। भाजपा नेता यशवंत सिन्हा की अध्यक्षता वाली वित्त संबंधी संसद की समिति ने हालांकि सुझाव दिया था कि पेंशन योजनाओं में 26 प्रतिशत की सीमा तय की जाए।


वाम दलों के कड़े विरोध के कारण प्रधानमंत्री मनमोहन सिंह के पूर्व कार्यकाल वाली सरकार के समय विधेयक संसद में पारित नहीं हो सका था। जून 2012 में तृणमूल कांग्रेस के विरोध के कारण कैबिनेट को विधेयक पर फैसला टालना पड़ा। विधेयक में प्रावधान है कि पीएफआरडीए देश में कई पेंशन निधियों की निगरानी कर सकता है और वहीं इस क्षेत्र का पूर्णकालिक नियामक भी होगा।


विधेयक में प्रावधान है कि जनवरी 2004 के बाद से भर्ती होने वाले सभी सरकारी कर्मचारी नई पेंशन योजना के तहत कवर होंगे। सैन्य बल इसमें शामिल नहीं हैं।

http://khabar.ndtv.com/news/show/fdi-in-pension-sector-approved-by-cabinet-27216


क्या आपकी पेंशन सेफ है?

0

इकनॉमिक टाइम्स | Sep 3, 2013, 01.30PM IST

ईपीएफओ की एंप्लॉयीज पेशन स्कीम का अनुमानित डेफिसिट 54,000 करोड़ रुपए है। अगर बेनेफिट प्लान अपने मौजूदा फॉर्म में चलता रहा तो जेनरेशन एक्स के पेंशन के काबिल होने तक यह स्कीम दिवालिया हो जाएगी। इस स्कीम में ईपीएस के 8.25 करोड़ मेंबर शामिल हैं।


बढ़ते घाटे के कारण यह चिंता जताई जा रही है कि ईपीएस फंड का गुब्बारा कुछ साल बाद फूट जाएगा। फिलहाल, हालात ज्यादा खराब नहीं हैं क्योंकि पेंशन पाने से ज्यादा योगदान करने वालों की संख्या है। हालांकि, आने वाले साल में यह ट्रेंड बदल जाएगा। आगे चलकर ज्यादा लोग पेंशन के योग्य होंगे और योगदान करने की संख्या सुस्त रफ्तार में बढ़ेगी। भविष्य में ज्यादा लोगों के रिटायर होने से हालात और खराब हो जाएंगे।


ईपीएफओ सालाना योगदान की सीमा 6,500 रुपए से बढ़ाकर 10,000 करने और मिनिमम पेंशन 1,000 रुपए प्रति महीना करने पर विचार कर रहा है। इससे डेफिसिट और बढ़ सकता है। बढ़ते घाटे और क्रॉस सब्सिडी की समस्या से निपटने के लिए एक एक्सपर्ट कमिटी ने 2010 में ईपीएस में बदलाव की सिफारिश की थी। हालांकि, इसकी ज्यादातर सिफारिशें सेंट्रल बोर्ड ऑफ ट्रस्टीज ने खारिज कर दीं।

ईपीएफओ का कहना है कि डेफिसिट के अनुमान सही नहीं हैं, क्योंकि यह सिर्फ 5 फीसदी ईपीएस मेंबर्स की उम्र और इनकम डाटा पर आधारित है। संस्था ने अब एक्चुअरी को 70-75 फीसदी ईपीएस मेंबरों को डाटा दिया है। इस पर आधारित वैल्यूएशन रिपोर्ट अगले हफ्ते आने की उम्मीद है।


समर्थकों की दलील

-वैल्यूएशन के मुताबिक, ईपीएस डेफिसिट हर साल बढ़ रहा है। कुछ साल में स्कीम दिवालिया हो सकती है।


-लोगों की उम्र बढ़ने और ज्यादा एंप्लॉयीज के रिटायर होने से स्कीम के डेफिसिट में और बढ़ोतरी होगी। पूल सिस्टम के बजाय मेंबर्स के लिए इंडिविजुअल अकाउंट्स होने चाहिए।


-एनपीएस टिकाऊ स्कीम है। ईपीएस मेंबर्स को उनकी मर्जी के आधार पर एनपीएस में जाने की इजाजत दी जानी चाहिए।


-अगर पेंशन के लिए योगदान की गई राशि पर 8 फीसदी ब्याज मिलता है, तो इस पर एन्युटी ईपीएस पेंशन से ज्यादा हो सकती है।


-तय फायदा मेंबर्स के हितों के खिलाफ है। अगर स्कीम दिवालिया हो जाती है, तो उन्हें कुछ नहीं मिलेगा।


आलोचकों की राय

-यह आकलन 5 फीसदी मेंबर्स की उम्र और इनकम पर आधारित है और सटीक वैल्यूएशन का पता लगाया जा रहा है।


-वर्ल्ड बैंक पेंशन वैल्यूएशन पर आधारित 2011 की स्टडी में कहा गया है कि यह स्कीम 2075 तक टिकाऊ है।


-विधवाओं, अनाथ और विकलांगों के लिए पेंशन जैसे फायदे पूल सिस्टम में है। एनपीएस में तय कंट्रीब्यूशन प्लान है। सरकार एनपीएस को इसलिए बढ़ावा दे रही है, क्योंकि स्कीम से जुड़ने वालों की संख्या कम है।


-ईपीएस के दूसरे फायदे भी हैं। कोई स्कीम विधवाओं, अनाथ और विकलांगों के लिए पेंशन ऑफर नहीं करती।


-सरकार वादे से बचने की कोशिश कर रही है। वर्कर्स को हर हाल में फिक्स्ड पेंशन का हक मिलना चाहिए।

National Pension Scheme

From Wikipedia, the free encyclopedia

For the generic concept, see National pension.

PFRDA Logo with original colours

The National Pension System (NPS) [1] is a defined contribution based pension system launched by Government of India with effect from 1 January 2004. Like most other developing countries, India does not have a universal social security system to protect the elderly against economic deprivation. As a first step towards instituting pension reforms,Government of India moved from a defined benefit pension to a defined contribution based pension system. Apart from offering wide gamut of investment options to employees, this scheme would help government of India to reduce its pension liabilities. Unlike existingpension fund of Government of India that offered assured benefits, NPS has defined contribution and individuals can decide where to invest their money. The scheme is structured into two tiers:

  • Tier-I account: This NPS account does not allow premature withdrawal and is available from 1 May 2009

  • Tier-II account: The tier-II NPS account permits withdrawal.

Since 1 April 2008, the pension contributions of Central Government employees covered by the National Pension System (NPS) are being invested by professional Pension Fund Managers in line with investment guidelines of Government applicable to non-Government Provident Funds. A majority of State Governments have also shifted to the defined contribution based National Pension System from varying dates. 27 State/UT Governments have notified the NPS for their new employees. Of these, 6 states have already signed agreements with the intermediaries of the NPS architecture appointed by Pension Fund Regulatory and Development Authority (PFRDA) for carrying forward the implementation of the National Pension System. The other States are in the process of finalization of documentation.

Contents

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Regulator[edit source | editbeta]

Pension Fund Regulatory and Development Authority (PFRDA) is the prudential regulator for the NPS. PFRDA was established by theGovernment of India on 23 August 2003 to promote old age income security by establishing, developing and regulating pension funds. PFRDA has set up a Trust under the Indian Trusts Act, 1882 to oversee the functions of the PFMs. The NPS Trust is composed of members representing diverse fields and brings wide range of talent to the regulatory framework.

Coverage and eligibility[edit source | editbeta]

NPS was made available to all citizens of India on voluntary basis and is mandatory for employees of central government (except armed forces) appointed on or after 1 January 2004. All Indian citizens between the age of 18 and 55 can join the NPS.

Tier-I is mandatory for all Govt. servants joining Govt. service on or after 1.1.2004. In Tier I, Govt. servants will have to make a contribution of 10% of his Basic Pay, DP and DA which will be deducted from his salary bill every month. The Govt. will make an equal matching contribution. Since 1 April 2008, the pension contributions of Central Government employees covered by the NPS are being invested by professional Pension Fund Managers in line with investment guidelines of Government. However, there will be no contribution from the Government in respect of individuals who are not Government employees. The contributions and returns thereon would be deposited in a non-withdrawable pension account.

In addition to the above pension account, each individual can have a voluntary tier-II withdrawable account at his option. Government will make no contribution into this account. These assets would be managed in the same manner as the pension. The accumulations in this account can be withdrawn anytime without assigning any reason. It's estimated that 8 crore citizens of India are eligible to join the NPS.

Operational structure[edit source | editbeta]

NPS is designed to leverage network of bank branches and post offices to collect contributions and ensure that there is seamless transfer of accumulations in case of change of employment and/or location of the subscriber. It offers a basket of investment choices and Fund managers. Dhirendra Swarup is one of the founders.

There will be one or more CRA, several PFMs to choose from which will offer different categories of schemes. The participating entities (PFMs, CRA etc.) would give out easily understood information about past performance & regular NAVs, so that the individual would able to make informed choices about which scheme to choose. PFMs would share this common CRA infrastructure. The PFMs would invest the savings people put into their PRAs, investing them in three asset classes, equity (E), government securities (G) and debt instruments that entail credit risk (C), including corporate bonds and fixed deposits.

Contribution guidelines[edit source | editbeta]

The following contribution guidelines have been set by the PFRDA:

  • Minimum amount per contribution: Rs. 500 per month

  • Minimum number of contributions: 1 in a year

  • Minimum annual contribution: Rs 6,000 in each subscriber account.

If the subscriber is unable to contribute the minimum annual contribution, a default penalty of Rs.100 per year of default would be levied and the account would become dormant. In order to re-activate the account, subscriber will have to pay the minimum contributions, along with penalty due. A dormant account will be closed when the account value falls

Investment options[edit source | editbeta]

Under the investment guidelines finalized for the NPS, pension fund managers will manage three separate schemes, each investing in different asset class. The three asset classes are equity, government securities and credit risk-bearing fixed income instruments. The subscriber will have the option to actively decide as to how the NPS pension wealth is to be invested in three asset classes:

  1. E Class: Investment would primarily be in Equity market instruments. It would invest in Index funds that replicate the portfolio of either BSE Sensitive index or NSE Nifty 50 index.

  2. G Class: Investment would be in Government securities like GOI bonds and State Govt. bonds

  3. C Class: Investment would be in fixed income securities other than Government Securities

* Liquid Funds of AMCs regulated by SEBI with filters suggested by the Expert Group

* Fixed Deposits of scheduled commercial banks with filters

* Debt securities with maturity of not less than three years tenure issued by bodies Corporate including scheduled commercial banks and public financial institutions

Credit Rated Public Financial Institutions/PSU Bonds

Credit Rated Municipal Bonds/Infrastructure Bonds

In case the subscriber does not exercise any choice as regards asset allocation, the contribution will be invested in accordance with the 'Auto choice' option. In this option the investment will be determined by a predefined portfolio. At the lowest age of entry (18 years) the auto choice will entail investment of 50% of pension wealth in "E" Class, 30% in "C" Class and 20% in "G" Class. These ratios of investment will remain fixed for all contributions until the participant reaches the age of 36. From age 36 onwards, the weight in "E" and "C" asset class will decrease annually and the weight in "G" class will increase annually till it reaches 10% in " E", 10% in "C" and 80% in " G" class at age 55. The following table will illustrates this auto choice more clearly-

Class

Till the of age 35 years

At age 55 Years

E

50%

10%

C

30%

10%

G

20%

80%

Investment charges[edit source | editbeta]

NPS levies extremely low Investment management charge of 0.00010% on net AUM (Asset Under Management). This is extremely low as compared to charges levied by mutual funds or other investment products. Initial charge of opening the account would be Rs. 470. From second year onwards the minimum charge would be Rs. 350 a year. As per the offer document of NPS, annual and transaction charges would be reduced once the number of accounts in CRA reaches 10 lakh.

Withdrawal norms[edit source | editbeta]

If subscriber exits before 60 years of age, he/she has to invest 80% of accumulated saving to purchase a life annuity from IRDA regulate life insurer. The remaining 20% may be withdrawn as lump sum. On exit after age 60 years from the pension system, the subscriber would be required to invest at least 40% of pension wealth to purchase an annuity. In case of Government employees, the annuity should provide for pension for the lifetime of the employee and his dependent parents and his spouse at the time of retirement. If subscriber does not exit the system at or before 70 years, account would be closed with the benefits transferred to subscriber in lump sum. If a subscriber dies, the nominee has the option to receive the entire pension wealth as a lump sum. Recent changes permit subscriber to continue to remain invested after 60 and up to 70 but subscriber can no longer add further investments. Subscriber to intimate the period of deferment and can not withdraw during the deferment period. If the subscriber does not exit by 70, the lumpsum will be monetised and transferred to subscriber's bank account.

Tax treatment[edit source | editbeta]

The offer document of NPS does not specify the tax benefits in elaborate manner. It specifies "Tax benefits would be applicable as per Income Tax Act, 1961 as amended from time to time." As per current provisions, withdrawals under the NPS attract tax under the EET (exempt-exempt-taxable) system, which means that while contributions and returns to the NPS are exempt up to a limit, withdrawals would be taxed as normal income (EET). ncessions for contributions made in National Pension System in the budget 2011.

While the NPS subscribers are directly benefited from one of these Income tax concessions, the second one is beneficial to the employers who contribute for NPS each month equivalent to employees contribution in Tier I.

Income tax concession to Employees under NPS:

So far, the contribution made by a National Pension System subscriber in Tier I scheme is deductible from the total income under Section 80CCD of the Income Tax Act. Like wise, the contribution made by the employer for the employee in Tier I of National Pension System is also deductible under Section 80CCD. However, the aggregate deduction under Section 80C, 80CCC and 80CCD is fixed at Rs.1 lakh.

So, if the NPS subscriber is already having other eligible deductions such as LIC premium, PPF, bank or NSC deposits, ELSS etc., under Section 80C, 80CCC and Section 80CCD., deduction allowed under Section 80CCD in respect of National Pension System may not be of much useful as the overall limit of savings eligible for deduction is pegged at Rs. 1 lakh.

Further, contribution made by the National Pension System should also be included in the Total income of NPS subscriber as far as calculation of income tax is concerned, while full deduction of the same from income under Section 80CCD may not be possible as other savings made by the subscriber covers the overall limit of Rs.1 lakh under Section 80CCD. Hence, for a NPS subscriber contribution for NPS by the Government is taxable in most of the cases.

For example, if an employee receives a salary of Rs.40,000 (pay+da), 10% of the same (Rs.4000) is paid by him as contribution towards NPS. The Government will also be paying Rs.4000 in this case in NPS fund of the said employee. Until now, an amount of Rs.96,000 (Rs.48,000+Rs.48000) could be deductible from the total income as far as this employee is concerned under Section 80CCD.

However, if the said employee has been paying LIC premium of Rs.20,000 per year, he will be allowed to deduct only Rs.4000 in respect of the same under Section 80CC as total ceiling of Rs.1,00,000 under Section 80CCE will apply in this case. So, an eligible deduction of Rs.16,000 could not be availed under Section 80CCD. In other words, employer contribution to NPS to an extent of Rs.16,000, which is already included in the income is taxable in this case.

However, the Finance Act, 2011 amended section 80CCE so as to provide that the contribution made by the Central Government or any other employer to the pension scheme under section 80CCD shall be excluded from the limit of one lakh rupees provided under section 80CCE. This proposal is effective from the assessment year 2012-13 (financial year 2011-12) and would totally exempt employer's contribution in NPS from levying income tax on the employee.

Income tax concession to Employers under NPS:

The Finance Act, 2011 amended section 36 so as to provide that any sum paid by the assessee as an employer by way of contribution towards a pension National Pension System(NPS) to the extent it does not exceed ten per cent of the salary of the employee, shall be allowed as deduction in computing the income under the head "Profits and gains of business or profession".

This amendment will be effective from 1 April 2012 and will be applicable to the assessment year 2012-13 (for the income earned in the financial year 2011-12) and subsequent years.

Past investment returns[edit source | editbeta]

The NPS architecture has been managing money since April 2008. Rs.2100 crore is invested as corpus of Central Government employees. In 2008-09, as per unaudited results of the Pension Funds, the average weighted return on the corpus have been over 14.5% with the individual returns of three Pension Funds varying from 12% to 16% on the NPS corpus during the year 2008-09, weighted average return being over 14.5 per cent. According to the latest data released by the government in Parliament on Aug 23, 2011, return on investment is as low as 1.8% in case of those private sector employees, who opted for investments in government securities, the safest of the categories. The performance of the three pension fund managers for the central government employees indicate that the returns on subscribers' contributions under NPS ranged between 8% and 16% during 2008-09 and 2010-11.[2]

Swavalamban Yojana As mentioned in the operating guidelines issued by MoF, "Government will contribute Rs. 1000 per year to each NPS account opened in the year 2010-11 and for the next three years, that is, 2011-12, 2012-13 and 2013-14. As a special case and in recognition of their faith in the NPS, all NPS accounts opened in 2009-10 will be entitled to the benefit of Government contribution under this scheme as if they were opened as new accounts in 2010-11 subject to the condition that they fulfill all the eligibility criteria prescribed under these guidelines."

Accordingly, the basic eligibility criteria for joining the Swavalamban Yojana for a subscriber is given below: Permanent Retirement Account should be opened in the year 2009-10 or 2010-11 and Minimum contribution should be Rs. 1,000 per annum (Financial year) in Tier I account and maximum contribution should be Rs. 12,000 per annum (Financial year) in both Tier I as well as Tier II account together.

References[edit source | editbeta]

External links[edit source | editbeta]

Categories:


सेंसेक्स 333 अंक चढ़ा, निफ्टी 5448 पर बंद

मुंबई। रुपये में शानदार रिकवरी आने की वजह से बाजारों में 2 फीसदी मजबूती आई। सेंसेक्स 333 अंक चढ़कर 18567 और निफ्टी 107 अंक चढ़कर 5448 पर बंद हुए। रुपये में करीब 56 पैसे की मजबूती आई है। एक अमेरिकी डॉलर की कीमत की 67.07 रुपये है। एमिडकैप और स्मॉलकैप शेयर 1-0.75 फीसदी चढ़े। मेटल, हेल्थकेयर, ऑटो, तकनीकी, आईटी, बैंक, ऑयल एंड गैस, पावर शेयर 2.75-2 फीसदी चढ़े। पीएसयू, कैपिटल गुड्स, कंज्यूमर ड्यूरेबल्स शेयर 1.5-1 फीसदी मजबूत हुए। एफएमसीजी शेयरों में बढ़त रही। रियल्टी शेयर 0.5 फीसदी गिरे

मंगलवार की भारी गिरावट के बाद आज बाजार रिकवरी के मूड में दिखे। रघुराम राजन के आरबीआई के गवर्नर पद संभालने से बाजार में उम्मीद जागी है। इसका असर रुपये पर भी दिखा। खराब एशियाई संकेतों और रुपये में कमजोरी आने के बावजूद बाजार बढ़त पर खुले। शुरुआती कारोबार में बाजार में तेजी बढ़ा। सेंसेक्स 200 अंक चढ़ा। निफ्टी 5400 के ऊपर पहुंच गया। निफ्टी में करीब 120 अंक की तेजी आई। हालांकि, कमजोर यूरोपीय संकेतों की वजह से बाजार ऊपरी स्तरों से फिसले। लेकिन, दोपहर के बाद बाजार में खरीदारी लौटी। सेंसेक्स 300 अंक से ज्यादा और निफ्टी 100 अंक से ज्यादा चढ़े।

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बतौर आरबीआई गवर्नर डी.सुब्बाराव का कार्यकाल आज समाप्त हो गया है। 5 साल का उनका कार्यकाल चुनौतियों और विवादों से भरा रहा। उनके कार्यकाल में पिछले 8 हफ्ते से डॉलर के मुकाबले रुपया रिकॉर्ड निचले स्तर तक फिसल रहा है। सुब्बाराव के पूरे कार्यकाल के दौरान गंभीर आर्थिक चुनौतियां हावी रहीं।

सुब्बाराव ने 5 सितंबर 2008 को जब RBI की कमान संभाली तो लेहमान संकट ने उसका स्वागत किया। उनके पदभार लेने के दस दिन के बाद ही अमेरिका के लेहमान ने दीवालिया होने के लिए आवेदन दिया था। लेहमान के इस कदम के बाद दुनिया भर के शेयर बाजारों में कोहराम मच गया था।


रिजर्व बैंक के नवनियुक्त गवर्नर रघुराम गोविंद राजन ने देश के समक्ष मौजूदा आर्थिक चुनौतियों का जिक्र करते हुए कहा कि अर्थव्यवस्था की बुनियाद मजबूत है और संकट का दौर जल्दी खत्म होगा। राजन ने रिजर्व बैंक के 23वें गवर्नर के तौरपर पदभार ग्रहण करने के बाद पत्रकारों से कहा कि वह बेहद कठिन दौर में आरबीआई की कमान संभाल रहे हैं। उन्होंने कहा कि हालांकि मौद्रिक स्थिरता बनाए रखना आरबीआई का मुख्य लक्ष्य रहा है, लेकिन इसके साथ ही समावेशी विकास और वित्तीय स्थिरता भी उसकी योजनाओं का अहम हिस्सा है।

उन्होंने कहा कि भारतीय अर्थव्यवस्था को लेकर कुछ ज्यादा ही नकारात्मक सोच दिखाई दे रही है, जबकि हालात ऐसे नहीं है और अर्थव्यवस्था की बुनियाद अभी भी मजबूत बनी हुई है। राजन ने कहा कि आरबीआई को भी किसी चीज के लिए ना नहीं कहना है और हर हालात का मुकाबला करने के लिए तैयार रहना है। उन्होंने रिजर्व बैंक की नीतियों को और अधिक पारर्दशी बनाए जाने पर जोर देते हुए कहा कि आरबीआई को अपने उद्देश्यों के अनुरुप आर्थिक स्थायित्व का पुरोधा बने रहना है।


सेंट पीटर्सबर्ग। प्रधानमंत्री मनमोहन सिंह आठवें जी-20 शिखर सम्मेलन में हिस्सा लेने के लिए बुधवार को रूस के पश्चिमोत्तर शहर सेंट पीटर्सबर्ग पहुंच गए। शिखर सम्मेलन में हिस्सा लेने और द्विपक्षीय मुलाकातों के साथ ही प्रधानमंत्री ब्राजील, रूस, चीन और दक्षिण अफ्रीका के नेताओं के साथ मुलाकात करेंगे, जिनको सामूहिक रूप से ब्रिक्स कहा जाता है।


प्रधानमंत्री शनिवार को नई दिल्ली लौटेंगे। आठवें जी-20 शिखर सम्मेलन का उद्देश्य गुणवत्तायुक्त रोजगार और निवेश, विश्वास और पारदर्शिता और प्रभावी नियमों के माध्यम से विकास की एक नई श्रृंखला शुरू करना है।


दागी नेताओं पर नहीं पलटेगा फैसला: सुप्रीम कोर्ट

नई दिल्ली। सुप्रीम कोर्ट ने केंद्र सरकार की उस याचिका को खारिज कर दिया है जिसमें सरकार ने दागी नेताओं के मामले में सुप्रीम कोर्ट से अपने फैसले पर दोबारा विचार करने की गुहार लगाई थी।

सुप्रीम कोर्ट ने अपने फैसले में कहा था कि किसी नेता को जिस तारीख को सजा सुनाई जाएगी, उसी दिन से उस विधायक या सांसद की सदस्यता निरस्त मानी जाएगी। हालांकि सुप्रीम कोर्ट ने जेल से चुनाव न लड़ सकने के अपने फैसले के खिलाफ दायर पुनर्विचार याचिका स्वीकार कर ली है और संबंधित पक्षों को नोटिस दिया है। चुनाव आयोग, बिहार सरकार और एनजीओ 'जन-चौकीदार' को नोटिस जारी किया गया है।

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BJP, govt strike deal to end stand-off over missing coal files, agree to debatePrime Minister had left both the Lok Sabha and the Rajya Sabha immediately after reading out a statement on the missing files (PTI)

The stand-off between the government and main Opposition party, Bharatiya Janata Party (BJP) was resolved today after an agreement that a discussion on missing coal files issue would be taken up immediately in both Houses of Parliament.

Related: BJP corners PM on missing coal block files

The end to the impasse came after two rounds of discussions that Finance Minister P Chidambaram and Parliamentary Affairs Minister Kamal Nath had with top BJP leaders L K Advani, Sushma Swaraj and Arun Jaitley.

At the meeting, the Ministers asked BJP to allow proceedings in the two Houses so that important legislative business including Pension Bill and Land Acquisition Bill could be taken up, sources said.

Related: PM should take moral responsibility, says BJP

However, BJP leaders insisted that the issue of coal files needed to be taken up on priority, particularly in the wake of reports that a senior CBI officer had sought questioning of Prime Minister Manmohan Singh in connection with allocations made when he held the Coal portfolio between 2006 and 2009.

BJP said that after debate on coal issue, it would allow continuation of discussion on Pension Bill in the Lok Sabha and consideration of Land Acquisition Bill in the Rajya Sabha.

Related: BJP demands SIT probe into coal scam

Finally, the agreement was reached, under which a debate was taken up on coal issue. BJP leadership is upset over the manner in which the Prime Minister had left both the Lok Sabha and the Rajya Sabha immediately after reading out a statement on the missing files pertaining to the coal block allocations yesterday. BJP leaders wanted to seek clarifications on his statement but were not allowed.



Reliance Industries on track to invest over $24 bn in key projects by 2017RIL also outperformed regional/global peers as well as the Indian market.

RIL, according to Goldman, offers the best downstream exposure in the Asian oil sector with its high quality asset base, diversified product portfolio, efficient management of inventory valuation swings and ability to fund large organic expansionary capex without taking on debt.

Last year, apart from being a top performer among Indian energy stocks, RIL also outperformed regional/global peers as well as the Indian market.

"Moreover, RIL is a key beneficiary of the weakening Rupee-US dollar exchange rates, as its revenues for all businesses except retail are in US dollar and we estimate about 50 per cent of the benefit of higher revenues fall to the PBT level after adjusting for higher interest payments on its US dollar debt," it said.

Every one rupee depreciation in rupee against US dollar would lead to 2 per cent improvement in RIL's FY14-17 net profit.

Goldman said RIL has commenced work on all the major value-enhancing projects such as petcoke gasification project and refinery off-gas cracker project (ROGC) and is in various stages of detailed engineering/ordering equipment.


Indian economy has a 'bright future', says new RBI chief Raghuram RajanRaghuram Rajan took over as the new Governor of the Reserve Bank of India on Wednesday. (Express photo: Prashant Nadkar)

The new governor of the Reserve Bank of India, Raghuram Rajan, said on Wednesday the country's economy was "fundamentally sound" and had a "bright future" in his first remarks after taking the helm at the central bank earlier in the day.

Rajan, the renowned economist, said he will come out with RBI's first credit policy statement on September 20.

Raghuram Rajan takes over as 23rd Governor of RBI

Rajan also stressed that monetary stability is the prime role of RBI.

New RBI Governor Raghuram Rajan: Quotes

Addressing a press conference at the RBI headquarters in Mumbai, Rajan said: "This is not an easy time...We have to be careful of not injecting more uncertainty than economy can handle...we have very stable, solid economy; we are going through challenging times."

Rajan also outlined several measures to support the Indian rupee. "As our trade expands, we will push for more settlement in rupees. This will also mean we will have to open up our financial markets more to those who will receive rupees so that they can invest it back in," Rajan said at a news briefing on his first day in office.

Allowing importers to rebook 25 percent of cancelled forward contracts, offering swap windows for dollar deposits and new bank licences were among the slew of promises made by the new RBI chief.

The central bank will offer a swap window to banks for fresh dollar deposits mobilised from non-resident Indians, which will be available to lenders till November 30, 2013, he said.

The central bank will offer the swap for dollar funds mobilised for three years and above at a fixed rate of 3.5 percent per annum. The RBI will also provide swap lines at a concessional rate of 100 basis points below the market rate to banks for their overseas borrowing, he said.

http://www.indianexpress.com/news/indian-economy-has-a-bright-future-says-new-rbi-chief-raghuram-rajan/1164588/


Let the rupee settle down

The newly appointed RBI governor, Raghuram Rajan, will have his task cut out when he assumes the challenging role this week, as the Indian economy remains sluggish. Below-par growth, large twin deficits (current and fiscal), a fragile currency and sticky consumer prices have led to muted business confidence. Political uncertainty is another cause for concern, as fresh investments might remain in cold storage till the constituents of a newly elected Lok Sabha's treasury benches become clear.

In addition, considerable uncertainties prevail about the external economic climate amid fears of earlier-than-expected QE exit by the US Federal Reserve. While the leading central banks' loose monetary policy to prevent a major global collapse has been successful, a smooth exit from the stimulus could prove to be tricky.

Concerns over how the imminent QE exit by the US Fed will play out has precipitated a sharp fall in the Indian rupee, which is down ~14% since May 2013, making it one of the worst currencies in the emerging markets (EM) in the past few months. Among the key factors behind the Indian rupee's battering has been the elevated CAD (4.8% of GDP) and high fiscal deficit (4.9% of GDP in FY13), leading to FII outflows to the tune of $10 billion in the June-July period.

In view of the sharp fall in the rupee over the last few weeks, the RBI's monetary policy focus has shifted towards exchange rate stability. The central bank has unleashed a series of liquidity tightening measures aimed at curbing speculation and arresting the slide of the rupee. Although the rupee did recover modestly after the RBI steps, concerns over FII outflows and large twin deficits sent the local currency to a new record low of 61.80 on August 6. Going forward, external factors like the Federal Reserve's monetary policy stance will be a key driver, as it will determine the direction of FII flows into emerging markets like India.

http://www.indianexpress.com/news/let-the-rupee-settle-down/1163112/

Pension

From Wikipedia, the free encyclopedia

This article is about the retirement income arrangement. For the type of lodging, see Pension (lodging). For the mortgage repayment scheme, see Mortgage loan.

A pension is a contract for a fixed sum to be paid regularly to a person, typically followingretirement from service.[1] Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.

The terms retirement plan and superannuation refer to a pension granted upon retirement of the individual.[2] Retirement plans may be set up by employers, insurance companies, the government or other institutions such as employer associations or trade unions. Calledretirement plans in the United States, they are commonly known as pension schemes in the United Kingdom and Ireland and superannuation plans (or super[3]) in Australia andNew Zealand. Retirement pensions are typically in the form of a guaranteed life annuity, thus insuring against the risk of longevity.

A pension created by an employer for the benefit of an employee is commonly referred to as an occupational or employer pension. Labor unions, the government, or other organizations may also fund pensions. Occupational pensions are a form of deferred compensation, usually advantageous to employee and employer for tax reasons. Many pensions also contain an additional insurance aspect, since they often will pay benefits to survivors or disabled beneficiaries. Other vehicles (certain lottery payouts, for example, or an annuity) may provide a similar stream of payments.

The common use of the term pension is to describe the payments a person receives upon retirement, usually under pre-determined legal or contractual terms. A recipient of a retirement pension is known as a pensioner or retiree.

Contents

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Types of pensions[edit source | editbeta]

Employment-based pensions (retirement plans)[edit source | editbeta]

A retirement plan is an arrangement to provide people with an income during retirement when they are no longer earning a steady income from employment. Often retirement plans require both the employer and employee to contribute money to a fund during their employment in order to receive defined benefits upon retirement. It is a tax deferred savings vehicle that allows for the tax-free accumulation of a fund for later use as a retirement income. Funding can be provided in other ways, such as from labor unions, government agencies, or self-funded schemes. Pension plans are therefore a form of "deferred compensation". A SSAS is a type of employment-based Pension in the UK.

Some countries also grant pensions to military veterans. Military pensions are overseen by the government; an example of a standing agency is the United States Department of Veterans Affairs. Ad hoc committees may also be formed to investigate specific tasks, such as the U.S. Commission on Veterans' Pensions (commonly known as the "Bradley Commission") in 1955–56. Pensions may extend past the death of the veteran himself, continuing to be paid to the widow; see, for example, the case of Esther Sumner Damon, who was the last surviving American Revolutionary War widow at her death in 1906.

Social and state pensions[edit source | editbeta]

Many countries have created funds for their citizens and residents to provide income when they retire (or in some cases become disabled). Typically this requires payments throughout the citizen's working life in order to qualify for benefits later on. A basic state pension is a "contribution based" benefit, and depends on an individual's contribution history. For examples, see National Insurance in the UK, or Social Security in the USA.

Many countries have also put in place a "social pension". These are regular, tax-funded non-contributory cash transfers paid to older people. Over 80 countries have social pensions.[4] Examples are the "older person's grant" in South Africa and the Universal Superannuation scheme in New Zealand.[5][6]

Disability pensions[edit source | editbeta]

Some pension plans will provide for members in the event they suffer a disability. This may take the form of early entry into a retirement plan for a disabled member below the normal retirement age.

Benefits[edit source | editbeta]

Retirement plans may be classified as defined benefit or defined contribution according to how the benefits are determined.[7] A defined benefit plan guarantees a certain payout at retirement, according to a fixed formula which usually depends on the member's salary and the number of years' membership in the plan. A defined contribution plan will provide a payout at retirement that is dependent upon the amount of money contributed and the performance of the investment vehicles utilized.

Some types of retirement plans, such as cash balance plans, combine features of both defined benefit and defined contribution plans. They are often referred to as hybrid plans. Such plan designs have become increasingly popular in the US since the 1990s. Examples include Cash Balance and Pension Equity plans.

Defined benefit plans[edit source | editbeta]

Main article: Defined benefit pension plan

A traditional defined benefit (DB) plan is a plan in which the benefit on retirement is determined by a set formula, rather than depending on investment returns. In the US, 26 U.S.C. § 414(j) specifies a defined benefit plan to be any pension plan that is not a defined contribution plan (see below) where a defined contribution plan is any plan with individual accounts. A traditional pension plan thatdefines a benefit for an employee upon that employee's retirement is a defined benefit plan.

Traditionally, retirement plans have been administered by institutions which exist specifically for that purpose, by large businesses, or, for government workers, by the government itself. A traditional form of defined benefit plan is the final salary plan, under which the pension paid is equal to the number of years worked, multiplied by the member's salary at retirement, multiplied by a factor known as the accrual rate. The final accrued amount is available as a monthly pension or a lump sum, but usually monthly.

The benefit in a defined benefit pension plan is determined by a formula that can incorporate the employee's pay, years of employment, age at retirement, and other factors. A simple example is a Dollars Times Service plan design that provides a certain amount per month based on the time an employee works for a company. For example, a plan offering $100 a month per year of service would provide $3,000 per month to a retiree with 30 years of service. While this type of plan is popular among unionized workers, Final Average Pay (FAP) remains the most common type of defined benefit plan offered in the United States. In FAP plans, the average salary over the final years of an employee's career determines the benefit amount.

Averaging salary over a number of years means that the calculation is averaging different dollars. For example, if salary is averaged over five years, and retirement is in 2009, then salary in 2004 dollars is averaged with salary in 2005 dollars, etc., with 2004 dollars being worth more than the dollars of succeeding years. The pension is then paid in first year of retirement dollars, in this example 2009 dollars, with the lowest value of any dollars in the calculation. Thus inflation in the salary averaging years has a considerable impact on purchasing power and cost, both being reduced equally by inflation

This effect of inflation can be eliminated by converting salaries in the averaging years to first year of retirement dollars, and then averaging.

In the United Kingdom, benefits are typically indexed for inflation (known as Retail Prices Index (RPI)) as required by law for registered pension plans.[8] Inflation during an employee's retirement affects the purchasing power of the pension; the higher the inflation rate, the lower the purchasing power of a fixed annual pension. This effect can be mitigated by providing annual increases to the pension at the rate of inflation (usually capped, for instance at 5% in any given year). This method is advantageous for the employee since it stabilizes the purchasing power of pensions to some extent.

If the pension plan allows for early retirement, payments are often reduced to recognize that the retirees will receive the payouts for longer periods of time. In the United States, under the Employee Retirement Income Security Act of 1974, any reduction factor less than or equal to the actuarial early retirement reduction factor is acceptable.[9]

Many DB plans include early retirement provisions to encourage employees to retire early, before the attainment of normal retirement age (usually age 65). Companies would rather hire younger employees at lower wages. Some of those provisions come in the form of additional temporary or supplemental benefits, which are payable to a certain age, usually before attaining normal retirement age.[10]

Funding[edit source | editbeta]

Defined benefit plans may be either funded or unfunded.

In an unfunded defined benefit pension, no assets are set aside and the benefits are paid for by the employer or other pension sponsor as and when they are paid. Pension arrangements provided by the state in most countries in the world are unfunded, with benefits paid directly from current workers' contributions and taxes. This method of financing is known as Pay-as-you-go (PAYGO or PAYG).[11] The social security systems of many European countries are unfunded,[12] having benefits paid directly out of current taxes and social security contributions, although several countries have hybrid systems which are partially funded. Spain set up the Social Security Reserve Fund and France set up the Pensions Reserve Fund; in Canada the wage-based retirement plan (CPP) is funded, with assets managed by the CPP Investment Board while the U.S. Social Security system is funded by investment in special U.S. Treasury Bonds.

In a funded plan, contributions from the employer, and sometimes also from plan members, are invested in a fund towards meeting the benefits. The future returns on the investments, and the future benefits to be paid, are not known in advance, so there is no guarantee that a given level of contributions will be enough to meet the benefits. Typically, the contributions to be paid are regularly reviewed in a valuation of the plan's assets and liabilities, carried out by an actuary to ensure that the pension fund will meet future payment obligations. This means that in a defined benefit pension, investment risk and investment rewards are typically assumed by the sponsor/employer and not by the individual. If a plan is not well-funded, the plan sponsor may not have the financial resources to continue funding the plan. In many countries, such as the USA, the UK and Australia, most private defined benefit plans are funded[citation needed], because governments there provide tax incentives to funded plans (in Australia they are mandatory). In the United States, non-church-based private employers must pay an insurance-type premium to the Pension Benefit Guaranty Corporation, a government agency whose role is to encourage the continuation and maintenance of voluntary private pension plans and provide timely and uninterrupted payment of pension benefits.

Criticisms[edit source | editbeta]

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Traditional defined benefit plan designs (because of their typically flat accrual rate and the decreasing time for interest discounting as people get closer to retirement age) tend to exhibit a J-shaped accrual pattern of benefits, where the present value of benefits grows quite slowly early in an employee's career and accelerates significantly in mid-career: in other words it costs more to fund the pension for older employees than for younger ones (an "age bias"). Defined benefit pensions tend to be less portable than defined contribution plans, even if the plan allows a lump sum cash benefit at termination. Most plans, however, pay their benefits as an annuity, so retirees do not bear the risk of low investment returns on contributions or of outliving their retirement income. The open-ended nature of these risks to the employer is the reason given by many employers for switching from defined benefit to defined contribution plans over recent years. The risks to the employer can sometimes be mitigated by discretionary elements in the benefit structure, for instance in the rate of increase granted on accrued pensions, both before and after retirement.

The age bias, reduced portability and open ended risk make defined benefit plans better suited to large employers with less mobile workforces, such as the public sector (which has open-ended support from taxpayers). This coupled with a lack of foresight on the employers part means a large proportion of the workforce are kept in the dark over future investment schemes.

Defined benefit plans are sometimes criticized as being paternalistic as they enable employers or plan trustees to make decisions about the type of benefits and family structures and lifestyles of their employees. However they are typically more valuable than defined contribution plans in most circumstances and for most employees (mainly because the employer tends to pay higher contributions than under defined contribution plans), so such criticism is rarely harsh.

The "cost" of a defined benefit plan is not easily calculated, and requires an actuary or actuarial software. However, even with the best of tools, the cost of a defined benefit plan will always be an estimate based on economic and financial assumptions. These assumptions include the average retirement age and lifespan of the employees, the returns to be earned by the pension plan's investments and any additional taxes or levies, such as those required by the Pension Benefit Guaranty Corporation in the U.S. So, for this arrangement, the benefit is relatively secure but the contribution is uncertain even when estimated by a professional. This has serious cost considerations and risks for the employer offering a pension plan.[13]

Examples[edit source | editbeta]

Many countries offer state-sponsored retirement benefits, beyond those provided by employers, which are funded by payroll or other taxes. The United States Social Security system is similar to a defined benefit pension arrangement, albeit one that is constructed differently than a pension offered by a private employer.

Individuals that have worked in the UK and have paid certain levels of national insurance deductions can expect an income from the state pension scheme after their normal retirement. The state pension is currently divided into two parts: the basic state pension, State Second [tier] Pension scheme called S2P. Individuals will qualify for the basic state pension if they have completed sufficient years contribution to their national insurance record. The S2P pension scheme is earnings related and depends on earnings in each year as to how much an individual can expect to receive. It is possible for an individual to forgo the S2P payment from the state, in lieu of a payment made to an appropriate pension scheme of their choice, during their working life. For more details see UK pension provision.

Defined contribution plans[edit source | editbeta]

Main article: Defined contribution plan

In a defined contribution plan, contributions are paid into an individual account for each member. The contributions are invested, for example in the stock market, and the returns on the investment (which may be positive or negative) are credited to the individual's account. On retirement, the member's account is used to provide retirement benefits, sometimes through the purchase of an annuity which then provides a regular income. Defined contribution plans have become widespread all over the world in recent years, and are now the dominant form of plan in the private sector in many countries. For example, the number of defined benefit plans in the US has been steadily declining, as more and more employers see pension contributions as a large expense avoidable by disbanding the defined benefit plan and instead offering a defined contribution plan.

Money contributed can either be from employee salary deferral or from employer contributions. The portability of defined contribution pensions is legally no different from the portability of defined benefit plans. However, because of the cost of administration and ease of determining the plan sponsor's liability for defined contribution plans (you do not need to pay an actuary to calculate the lump sum equivalent that you do for defined benefit plans) in practice, defined contribution plans have become generally portable.

In a defined contribution plan, investment risk and investment rewards are assumed by each individual/employee/retiree and not by the sponsor/employer, and these risks may be substantial.[14] In addition, participants do not necessarily purchase annuities with their savings upon retirement, and bear the risk of outliving their assets. (In the United Kingdom, for instance, it is a legal requirement to use the bulk of the fund to purchase an annuity.)

The "cost" of a defined contribution plan is readily calculated, but the benefit from a defined contribution plan depends upon the account balance at the time an employee is looking to use the assets. So, for this arrangement, the contribution is known but the benefit is unknown (until calculated).

Despite the fact that the participant in a defined contribution plan typically has control over investment decisions, the plan sponsor retains a significant degree of fiduciary responsibility over investment of plan assets, including the selection of investment options and administrative providers.

A defined contribution plan typically involves a number of service providers, including in many cases:

  • Trustee

  • Custodian

  • Administrator

  • Recordkeeper

  • Auditor

  • Legal counsel[15]

Examples[edit source | editbeta]

In the United States, the legal definition of a defined contribution plan is a plan providing for an individual account for each participant, and for benefits based solely on the amount contributed to the account, plus or minus income, gains, expenses and losses allocated to the account (see 26 U.S.C. § 414(i)). Examples of defined contribution plans in the United States include Individual Retirement Accounts (IRAs) and 401(k) plans. In such plans, the employee is responsible, to one degree or another, for selecting the types ofinvestments toward which the funds in the retirement plan are allocated. This may range from choosing one of a small number of pre-determined mutual funds to selecting individual stocks or other securities. Most self-directed retirement plans are characterized by certain tax advantages, and some provide for a portion of the employee's contributions to be matched by the employer. In exchange, the funds in such plans may not be withdrawn by the investor prior to reaching a certain age—typically the year the employee reaches 59.5 years old-- (with a small number of exceptions) without incurring a substantial penalty.

In the US, defined contribution plans are subject to IRS limits on how much can be contributed, known as the section 415 limit. In 2009, the total deferral amount, including employee contribution plus employer contribution, was limited to $49,000 or 100% of compensation, whichever is less. The employee-only limit in 2009 is $16,500 with a $5,500 catch-up. These numbers may increase each year and are indexed to compensate for the effects of inflation.

Examples of defined contribution pension schemes in other countries are, the UK's personal pensions and proposed National Employment Savings Trust (NEST), Germany's Riester plans, Australia's Superannuation system and New Zealand's KiwiSaver scheme. Individual pension savings plans also exist in Austria, Czech Republic, Denmark, Greece, Finland, Ireland, Netherlands, Slovenia and Spain[16]

Hybrid and cash balance plans[edit source | editbeta]

Hybrid plan designs combine the features of defined benefit and defined contribution plan designs.

A cash balance plan is a defined benefit plan made by the employer, with the help of consulting actuaries (like Kwasha Lipton, who it is said created the cash balance plan) to appear as if they were defined contribution plans. They have notional balances in hypothetical accounts where, typically, each year the plan administrator will contribute an amount equal to a certain percentage of each participant's salary; a second contribution, called interest credit, is made as well. These are not actual contributions and further discussion is beyond the scope of this entry suffice it to say that there is currently much controversy. In general, they are usually treated as defined benefit plans for tax, accounting and regulatory purposes. As with defined benefit plans, investment risk in hybrid designs is largely borne by the plan sponsor. As with defined contribution designs, plan benefits are expressed in the terms of a notional account balance, and are usually paid as cash balances upon termination of employment. These features make them more portable than traditional defined benefit plans and perhaps more attractive to a more highly mobile workforce.

Target benefit plans are defined contribution plans made to match (or resemble) defined benefit plans.

Contrasting types of retirement plans[edit source | editbeta]

Advocates of defined contribution plans point out that each employee has the ability to tailor the investment portfolio to his or her individual needs and financial situation, including the choice of how much to contribute, if anything at all. However, others state that these apparent advantages could also hinder some workers who might not possess the financial savvy to choose the correct investment vehicles or have the discipline to voluntarily contribute money to retirement accounts. This debate parallels the discussion currently going on in the U.S., where many Republican leaders favor transforming the Social Security system, at least in part, to a self-directed investment plan.

Financing[edit source | editbeta]

There are various ways in which a pension may be financed.

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This section requires expansion.(December 2008)

Defined contribution pensions, by definition, are funded, as the "guarantee" made to employees is that specified (defined) contributions will be made during an individual's working life.

There are many ways to finance your pension and save for retirement. Pension plans can be set up by your employer, matching your contribution each month, by the state or personally through a pension scheme with a financial institution, such as a bank or brokerage firm. Pension plans often come with a tax break depending on the country and plan type.

For example Canadians have the option to open a Registered Retirement Savings Plan (RRSP), as well as a range of employee and state pension programs.[17] This plan allows contributions to this account to be marked as un-taxable income and remain un-taxed until withdrawal. Most country's governments will provide advice on pension schemes.

History[edit source | editbeta]

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Widows' funds were among the first pension type arrangement to appear, for example Duke Ernest the Pious of Gotha in Germany, founded a widows' fund for clergy in 1645 and another for teachers in 1662.[18] 'Various schemes of provision for ministers' widows were then established throughout Europe at about the start of the eighteenth century, some based on a single premium others based on yearly premiums to be distributed as benefits in the same year.'[19]

Germany[edit source | editbeta]

As part of Otto von Bismarck's social legislation, the Old Age and Disability Insurance Bill was enacted in 1889. The Old Age Pension program, financed by a tax on workers, was originally designed to provide a pension annuity for workers who reached the age of 70 years, though this was lowered to 65 years in 1916. It is sometimes claimed that at the time life expectancy for the average Prussian was 45 years; in fact this figure ignores the very high infant mortality and high maternal death rate from childbirth of this era. In fact, an adult entering into insurance under the scheme would on average live to 70 years of age, a figure used in the actuarial assumptions included in the legislation.

Ireland[edit source | editbeta]

There is a history of pensions in Ireland that can be traced back to Brehon Law imposing a legal responsibility on the kin group to take care of its members who were aged, blind, deaf, sick or insane.[20] For a discussion on pension funds and early Irish law, see F Kelly,A Guide to Early Irish Law (Dublin, Dublin Institute for Advanced Studies, 1988). In 2010, there were over 76,291 pension schemes operating in Ireland.[21]

Today the Republic of Ireland has a two-tiered approach to the provision of pensions or retirement benefits. First, there is a state social welfare retirement pension, which promises a basic level of pension. This is a flat rate pension, funded by the national social insurance system and is termed Pay Related Social Insurance or PRSI. Secondly, there are the occupational pension schemes and self-employed arrangements, which supplement the state pension.

United Kingdom[edit source | editbeta]

Main article: Pensions in the United Kingdom

See also: English Poor Laws and Timeline of pensions in the United Kingdom

Until the 20th century, poverty was seen as a quasi-criminal state, and this was reflected in the Vagabonds and Beggars Act 1495 that imprisoned beggars. During Elizabethan times, English poor laws represented a shift whereby the poor were seen merely as morally degenerate, and were expected to perform forced labour in workhouses.

The beginning of the modern state pension was the Old Age Pensions Act 1908, that provided 5 shillings (£0.25) a week for those over 70 whose annual means do not exceed £31.50. It coincided with the Royal Commission on the Poor Laws and Relief of Distress 1905-09 and was the first step in the Liberal welfare reforms to the completion of a system of social security, with unemployment and health insurance through the National Insurance Act 1911.

After the war, the National Insurance Act 1946 completed universal coverage of social security. The National Assistance Act 1948formally abolished the poor law, and gave a minimum income to those not paying national insurance.

The early 1990s established the existing framework for state pensions in the Social Security Contributions and Benefits Act 1992 andSuperannuation and other Funds (Validation) Act 1992. Following the highly respected Goode Report, occupational pensions were covered by comprehensive statutes in the Pension Schemes Act 1993 and the Pensions Act 1995.

In 2002 the Pensions Commission was established as a cross party body to review pensions in the United Kingdom. The first Act to follow was the Pensions Act 2004 that updated regulation by replacing OPRA with the Pensions Regulator and relaxing the stringency of minimum funding requirements for pensions, while ensuring protection for insolvent businesses. In a major update of the state pension, the Pensions Act 2007, which aligned and raised retirement ages. Following that, the Pensions Act 2008 has set up automatic enrolment for occupational pensions, and a public competitor designed to be a low-cost and efficient fund manager, called the National Employment Savings Trust (or "Nest").

United States[edit source | editbeta]

Public pensions got their start with various 'promises', informal and legislated, made to veterans of the Revolutionary War and, more extensively, the Civil War. They were expanded greatly, and began to be offered by a number of state and local governments during the early Progressive Era in the late nineteenth century.[citation needed]

Federal civilian pensions were offered under the Civil Service Retirement System (CSRS), formed in 1920. CSRS provided retirement, disability and survivor benefits for most civilian employees in the US Federal government, until the creation of a new Federal agency, theFederal Employees Retirement System (FERS), in 1987.

Pension plans became popular in the United States during World War II, when wage freezes prohibited outright increases in workers' pay. The defined benefit plan had been the most popular and common type of retirement plan in the United States through the 1980s; since that time, defined contribution plans have become the more common type of retirement plan in the United States and many other western countries.

In April 2012, the Northern Mariana Islands Retirement Fund filed for Chapter 11 bankruptcy protection. The retirement fund is a defined benefit type pension plan and was only partially funded by the government, with only $268.4 million in assets and $911 million inliabilities. The plan experienced low investment returns and a benefit structure that had been increased without raises in funding.[22]According to Pensions and Investments, this is "apparently the first" US public pension plan to declare bankruptcy.[22]

Current challenges[edit source | editbeta]

A growing challenge for many nations is population ageing. As birth rates drop and life expectancy increases an ever-larger portion of the population is elderly. This leaves fewer workers for each retired person. In almost all developed countries this means that government and public sector pensions could collapse their economies unless pension systems are reformed or taxes are increased[dubious – discuss]. One method of reforming the pension system is to increase the retirement age. Two exceptions areAustralia and Canada, where the pension system is forecast to be solvent for the foreseeable future.[citation needed] In Canada, for instance, the annual payments were increased by some 70% in 1998 to achieve this. These two nations also have an advantage from their relative openness to immigration. However, their populations are not growing as fast as the U.S., which supplements a high immigration rate with one of the highest birthrates among Western countries. Thus, the population in the U.S. is not ageing to the extent as those in Europe, Australia, or Canada.

Another growing challenge is the recent trend of states and businesses in the United States purposely under-funding their pension schemes in order to push the costs onto the federal government. For example, in 2009, the majority of states have unfunded pension liabilities exceeding all reported state debt. Bradley Belt, former executive director of the PBGC (the Pension Benefit Guaranty Corporation, the federal agency that insures private-sector defined-benefit pension plans in the event of bankruptcy), testified before a Congressional hearing in October 2004, "I am particularly concerned with the temptation, and indeed, growing tendency, to use the pension insurance fund as a means to obtain an interest-free and risk-free loan to enable companies to restructure. Unfortunately, the current calculation appears to be that shifting pension liabilities onto other premium payers or potentially taxpayers is the path of least resistance rather than a last resort."

Challenges have further been increased by the post-2007 credit crunch. Total funding of the nation's 100 largest corporate pension plans fell by $303bn in 2008, going from a $86bn surplus at the end of 2007 to a $217bn deficit at the end of 2008.[23]

Notable examples of pension systems[edit source | editbeta]

Some of the listed systems might also be considered social insurance.

Market structure[edit source | editbeta]

The market for pension fund investments is still centered around the U.K.and U.S. economies.[citation needed] Japan and the EU are conspicuous by absence.[citation needed] As of 2005 the U.S. was the largest market for pension fund investments followed by the UK.[citation needed]

Pension reforms have gained pace worldwide in recent years and funded arrangements are likely to play an increasingly important role in delivering retirement income security and also affect securities markets in future years.

Obtaining survey data on pensions[edit source | editbeta]

Numerous worldwide health, aging and retirement surveys contain questions pertaining to pensions. The Meta Data Repository - created by the non-profit RAND Corporation and sponsored by the National Institute on Aging at the National Institutes of Health - provides access to meta data for these questions as well as links to obtain respondent data from the originating surveys.

See also[edit source | editbeta]

Specific:

References[edit source | editbeta]

External links[edit source | editbeta]

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