VIJAYAWADA: In a significant stride towards employment stability, the State Legislative Assembly passed the Andhra Pradesh Guaranteed Pension System (APGPS) Bill bringing the government employees under the ambit of the new pension scheme, on Wednesday.
Finance Minister Buggana Rajendranath Reddy, who introduced the Bill though it was not on the agenda, said the government wanted to ensure financial security and welfare of the government employees who subscribed to the Contributory Pension Scheme (CPS). “The objective of the State government is to ensure fiscal sustainability and inter-generational equity,” he stated in the Assembly.
The Minister said that the government employees recruited on or after September 1, 2004, were being covered under the CPS and there was a long-pending demand to restore the Old Pension Scheme (OPS) in lieu of the CPS. Though Chief Minister YS Jagan Mohan Reddy promised to abolish the CPS and to restore the OPS before elections, during the deliberations with employees’ unions, it was proved to be impractical as it would cause an unbearable burden on the State exchequer.
Thus, the State government came up with the GPS in the place of CPS. Informing the House that the GPS had been formulated after several consultations with all the stakeholders, Buggana said, “The Cabinet sub-committee and officials examined various models before devising the new pension scheme.”
“If the OPS were to be continued obdurately, the government would not be able to pay salaries in the next 10 years,” he stated, adding that states such as Tamil Nadu and West Bengal were implementing the National Pension System (NPS) with great difficulty. Exuding confidence in the GPS, Buggana went on to further say that other states in the country would soon take cues from the AP government for implementing the new pension scheme.
With 5.07 lakh government employees working in the State, the number of OPS employees is more than 2.02 lakh, while that of CPS employees is more than 3.73 lakh. The Bill entailed a financial implication of approximately Rs 2,500 crore by 2040. The GPS subscriber will get a monthly guaranteed pension at the rate of 50% of the last drawn basic pay. It will also ensure a monthly spouse pension at the rate of 60% of the guaranteed pension, in case of a shortfall in the annuity received by the spouse of the deceased APGPS subscriber.
Eligibility criteria
Minimum 10 years of qualifying service, if retiring on superannuation
Minimum 20 years of qualifying service, if retiring from service voluntarily
Minimum 10 years of qualifying service, if retiring from service on medical invalidation
Who can’t get benefits under GPS
Employees dismissed / removed from service and compulsory retirement arising from disciplinary action
Speaker adjourns House sine dine
Speaker Tammineni Sitaram on Wednesday adjourned the House sine die. The House sat for five days, functioning for 25.15 hours. Besides passing 18 bills, and conducting short discussions on six issues, the Assembly passed three resolutions. Interestingly, Chief Minister YS Jagan Mohan Reddy did not speak in the House during the entire session