Is transition from contributory
Provident Fund to Defined
Contribution Pension Scheme
permitted for the employees of
Autonomous Bodies? What will be
the date of effect in case of transition
from CPF to NPS in case of
employees who joined prior to
01.01.2004? What are the salient
features of this scheme?
Yes. The organizations are permitted to shift to NPS in respect of employees who have joined before 1/1/2004 vide OM dt 30/6/2009 No 1(2)/EV/2007 Department Of Expenditure Ministry of Finance. Date of effect will be the date when such option is exercised by the concerned employee. The other detailed operational features are as follows, a. The existing corpus of CPF (both employees and employers’) would be moved over to the trust fund accounts under NPS. b. In order to facilitate the transition from CPF to NPS, the autonomous body would make in addition one time ex gratia payment of 10% of the employer’s contribution for each of the employees opting to switch over to NPS. c. Recurring monthly contribution by employee @ 10% of Basic Pay + DA and a matching contribution by the autonomous body would be payable. d. The employer’s contribution would be payable from the month the organization/employee shifts over to NPS and would be limited to 10% of Basic Pay + DA.
Click here for more about National Pension Scheme-NPS
Yes. The organizations are permitted to shift to NPS in respect of employees who have joined before 1/1/2004 vide OM dt 30/6/2009 No 1(2)/EV/2007 Department Of Expenditure Ministry of Finance. Date of effect will be the date when such option is exercised by the concerned employee. The other detailed operational features are as follows, a. The existing corpus of CPF (both employees and employers’) would be moved over to the trust fund accounts under NPS. b. In order to facilitate the transition from CPF to NPS, the autonomous body would make in addition one time ex gratia payment of 10% of the employer’s contribution for each of the employees opting to switch over to NPS. c. Recurring monthly contribution by employee @ 10% of Basic Pay + DA and a matching contribution by the autonomous body would be payable. d. The employer’s contribution would be payable from the month the organization/employee shifts over to NPS and would be limited to 10% of Basic Pay + DA.
Click here for more about National Pension Scheme-NPS
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