CHENNAI: Tamil Nadu could have saved `670.36 crore if it had joined national pension scheme and designated a fund manager to manage the fund in compliance with Pension Fund Regulatory and Development Authority, a CAG report said. The state continued to invest its defined contributory pension scheme contributions in LIC and T-Bills, which earned a return of 5.47 per cent and 4.29 per cent respectively.
Since the state pays GPF subscribers 7.10 per cent interest, the difference in interest (nearly 2 per cent) has to be borne by the government. Had the government joined NPS and posted designated fund managers, PF subscribers would have got higher returns. The government did not join NPS and designate a fund manager even though 19 years had passed since the inception of DCPS.
Out of Rs 53,462.93 crore in the fund as of March 31, 2022, Rs 36,510 crore was invested with LIC’s ‘new group superannuation scheme with cash accumulation plan’. There was no pact between TN and LIC, and the interest on investments were based on LIC’s policies (5.47 per cent), which were much less than the interest paid to account holders by the government (7.10 per cent.)