Reconstituted Panel to have 18 members besides seven from PFRDA Board as ex-officio members
Updated On : May 22, 2022
Pension regulator Pension Fund Regulatory and Development Authority (PFRDA) has reconstituted the Pension Advisory Committee (PAC), which has been tasked to advise the regulator on framing regulations for the pension sector.
The reconstituted Panel has 18 members besides the PFRDA Chairman as its ex-officio Chairman and six PFRDA Board members as the ex-officio members of the PAC.
It may be recalled that the PFRDA Act stipulates that PAC cannot have more than twenty-five members, excluding ex officio members, to represent the interests of employees’ associations, subscribers, commerce and industry, intermediaries, and organizations engaged in pension research.
PAC can advise PFRDA on matters referred to it, and on such matters as the Panel may deem fit. The Panel is required to meet at least twice a year. Every meeting of the PAC has to be presided over by Chairperson (PFRDA Chairman).
Some of the new entrants into the Panel this time round are K.P.Krishnan, Honorary Research Professor, Centre for Policy Research and Dhirendra Kumar, President & CEO, Value Research, sources said. The representatives of the Pension Fund Management industry have also changed with the reconstituted Panel, including the Chief Executive Officer of LIC Pension Fund and Chief Executive Officer of Kotak Pension Fund. These two pension fund management houses have come in place of UTI Pension Fund and HDFC Pension Fund, it is reliably learnt.
The other members of PAC include Gaurav Sharma, DY Commandant Border Security Force as representative of Union Home Ministry; Ramesh Chandra Pandey, Section Officer, Finance Establishment Directorate as representative of Railways. The reconstituted PAC also has representation from the Defence Ministry, Finance Ministry, Department of Personnel & Training and Department of Posts, besides the Chief Executive of the Indian Banks Association (IBA). From the States side, the Director (budget) from the Finance Department of Madhya Pradesh has also been appointed as a member of PAC. From the industry front, the PAC has the Chairman of the CII National Committee on Insurance & Pensions as a member.
The other significant members are Chairman of NPS Trust, Managing Director & CEO of Protean eGov Technologies Ltd, Director of National Institute of Bank Management Pune, President of Institute of Actuaries of India and Chief Executive Officer of Fixed Income Money Market and Derivatives Association of India.
Each member of the PAC — other than ex-officio members — will have a term of office of three years from the date of nomination by the Authority.
The latest PAC reconstitution comes when the Indian economy is faced with several macroeconomic headwinds, such as global geopolitical tensions caused by the Russia-Ukraine conflict and runaway inflation in both developed and developing markets. Central banks worldwide are now resorting to monetary tightening to tame inflation, sources added.
India’s pension assets under management (AUM) have been growing robustly, clocking a compounded annual growth rate of an average of 30 per cent in recent years. As of the end of April 2022, overall Pension AUM stood at ₹ 7.39 lakh crore, up 25 per cent over ₹ 5.90 lakh crore as of April 2021. The number of NPS and Atal Pension Yojana subscribers recorded 22 per cent year-on-year growth as of April 2022 to 5.23 crore from 4.27 crore in April 2021.
Chattisgarh wants to exit NPS
After Rajasthan, it is now the turn of Chattisgarh that wants to pull out of the National Pension System (NPS). Chattisgarh government has written to PFRDA seeking a refund of the money deposited towards NPS since November 2004 along with accruals, sources said.
The letter from Chattisgarh Finance Secretary Alarmelmangai has conveyed to PFRDA that the Chattisgarh government has decided to reinstate the old pension scheme — basically, a defined pension benefit scheme and hence the State would like to withdraw from NPS, they added.
From April 1 this year, the Chattisgarh government had stopped the monthly contribution of employer and employee to the NPS accounts of employees. Between November 1, 2004, to March 31, 2022, the Chattisgarh Government transferred ₹11,850 crore (employee and employer contribution) to National Securities Depository Limited. The current market value of this contribution is ₹ 17,240 crore.
A new General Provident Fund (GPF) account has been opened by the State Government for each employee registered with NPS and the principal amounts contributed by the employees in their NPS accounts are proposed to be transferred to the Chattisgarh GPF accounts of the employees, it is learnt.