NPS money that of employees, can’t be transferred, states told

Jaipur: The Union government on Monday clarified that the funds deposited for National Pension System (NPS) cannot be given to state governments as per the current laws.

Both finance minister Nirmala Sitharaman and finance secretary Vivek Joshi said if any state is expecting that the funds deposited for NPS can be returned to them then it is impossible.

Citing the recent crash in Adani group companies’ shares, Rajasthan chief minister Ashok Gehlot had earlier said that the employees of the state government cannot be left at the mercy of the share market where NPS funds are invested.

He had also urged the Centre to give the funds of the state government employees deposited in NPS and said the state will move the Supreme Court if the funds are not transferred to the Old Pension Scheme (OPS) being implemented by the state government.

“If one state expects that the funds deposited with the EPFO should be given to the states. If this is the expectation then no. Employees have the entitlement to the money. The deposited money is earning interest and there should be clarity that the money comes into the hand (employees) post-retirement. The money deposited will come into the hands of the government, it is impossible,” Sitharaman told reporters on the sidelines of a post-budget discussion with various stakeholders.

Finance secretary Joshi said it is not a very good trend that some states have adopted the Old Pension Scheme (OPS) and other states are also demanding.

He said the money in the new pension scheme is related to the employees and it is in an agreement between the employee and the NPS Trust. If the employee quits before maturity, then there are different rules. “The law is very clear. The states cannot get that money,” Joshi said.