HYDERABAD: To raise awareness and sensitize the public about the repercussions of the Old Pension Scheme, the Foundation for Democratic Reforms (FDR) launched a campaign ‘The Inevitable’ at Ramanaidu Studios in Film Nagar on Thursday.
During the launch of the campaign, three short films were screened, depicting the inherent dangers of the scheme to the nation’s financial stability. During the session, Dr Jayaprakash Narayan, former civil servant and MLA, currently serving as the General Secretary of FDR shed light on the current fiscal position of governments, the impact of OPS, and the need to encourage citizens to cast their votes to oppose OPS.
The campaign seeks to raise awareness about the detrimental impact of OPS on citizens. The primary goal of the campaign is to secure widespread support against OPS by encouraging people to vote on www.refuseops.in.
FDR expresses concern about the unfunded Old Pension Scheme, noting its challenges amid growing pension liabilities and the looming threat to the financial stability and credit of India. The OPS disproportionately takes away 18% of current tax revenue, unfairly favouring only 3.2% of the workforce, while impacting the remaining 97%.
Moreover, OPS benefits are not only adjusted for inflation but are also linked to periodic salary hikes for government employees. In essence, past services are rewarded based on current salaries. This leads to an unsettling situation where pensions in many cases become several times the last drawn salary due to continual salary hikes. The impact of OPS on future generations and government resources is grave as people live longer and the number of retired people in the total population increases.
The experts at the event talked about alarming projections in the State of Andhra Pradesh highlighting that if the State reverts to OPS, the burden of salaries, interest payments, and pensions will be about 220% of the State’s own revenues in 2041, and 294% in 2050. With OPS, the debt-to-GDP ratio will surge to 77% in 2040, and 107% in 2050.
There will be no money in coffers, and creditors will not lend money. As a result, there will be no money to pay even salaries and pensions. The government will go bankrupt. All citizens and employees will suffer serious hardship. Addressing this impending crisis requires urgent and viable solutions before it spirals out of control.