AIPEF urges for old pension scheme restoration for power sector staff

19 Jul 2024 CW Team

The All India Power Engineers Federation (AIPEF) has urged the Finance Ministry to reinstate the old pension scheme for employees working in power corporations across various states and Union Territories. In a letter addressed to Finance Minister Nirmala Sitharaman, the AIPEF demanded a uniform old pension system for all employees and engineers in the power sector.

A copy of the letter was also submitted to the chief ministers of all states, the AIPEF stated.

The letter emphasised the need for the central government to issue instructions to all states to implement the same old pension system for power sector employees and engineers nationwide. Shailendra Dubey , Chairman, AIPEF explained that under the New Pension System (NPS), 10% of an employee's salary is deducted and 14% is contributed by the government or employer. This amount is invested in the market through institutions like LIC, and the pension is based on market value at retirement, which can result in a lower amount.

In contrast, the old pension scheme provides a pension equal to 50% of the last salary drawn, with adjustments for pay revisions. Additionally, the government is responsible for providing the pension without requiring contributions from employees. In the event of a pensioner's death, the family pension is provided to the spouse.

AIPEF argues that reinstating the old pension scheme would ensure better security and uniformity for power sector employees. (Source: ET)

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