Palaniswami’s refusal to commit himself to Old Pension Scheme shows that it is unfeasible

AIADMK general secretary Edappadi K. Palaniswami’s refusal to perpetrate himself to the restoration of the Old Pension Scheme (OPS) for the State authorities employees and teachers reflects his realisation that it is unsustainable successful the agelong run.

While interacting with journalists successful Salem connected the Pongal day (January 15), Mr. Palaniswami was asked whether helium would spell backmost to the OPS successful the lawsuit of his party’s triumph successful the Assembly election. His reply was that a determination would beryllium taken “depending upon the situation”. He added that his enactment would marque “only those promises that are feasible”. At the aforesaid time, helium criticised the ruling DMK for not having lived up to its 2021 electoral assurance connected the OPS.

Chief Minister M.K. Stalin announced a fewer weeks agone that his authorities would instrumentality the Tamil Nadu Assured Pension Scheme (TAPS), a premix of the OPS, the Unified Pension Scheme (UPS) of the Union government, and the Andhra Pradesh Guaranteed Pension Scheme (APGPS). The TAPS, envisaging the outgo of a monthly pension, has retained the constituent of contribution, arsenic recovered successful the Contributory Pension Scheme (CPS) oregon the National Pension System (NPS). About 10 days ago, the Tamil Nadu authorities issued an bid that the caller strategy came into unit connected January 1.

In the past 5 years oregon so, determination has been a inclination among definite States to revert to the OPS. States specified arsenic Rajasthan, Jharkhand and Chhattisgarh person announced their instrumentality to the OPS. However, the Reserve Bank of India and respective economists person been cautioning the State governments successful wide against reverting to the aged scheme, arguing that the determination would effect successful accumulation of unfunded liabilities successful the coming years.

Moreover, arsenic pointed retired by the Tamil Nadu government’s White Paper presented successful August 2021, the authorities had resorted to borrowing successful the past adjacent for items of non-discretionary spending that included pension payment, 1 of the important components of the committed expenditure.

With the expanding beingness expectancy, the fig of pensioners and household pensioners successful the State has been stabilising astatine astir seven lakhs for rather immoderate time. The demographic information of the pensioners uncover that betwixt 2017 and 2025, the spot of the pensioners, aged 80 and above, roseate by 1.7 times — from 41,489 to 1,13,380. It is nary wonderment that the year-on-year maturation of pension and different status benefits has mostly been successful treble digit.