Thiruvananthapuram, Kerala: While the LDF government has announced a new assured pension scheme in the state budget to guarantee a fixed pension for employees, several details are yet to be finalised. The full picture will emerge only once the rules are officially notified.

Like the National Pension System (NPS), employees will need to contribute a share under this scheme. The government will also add its contribution, and the funds will be transferred to a newly established state-managed pension fund. Currently, both employees and the government contribute 10% each under the NPS, and the same rate will continue in the new scheme.

Out of the approximately five lakh government employees, 45% are currently under the NPS. Around 2.22 lakh employees will benefit from the transition to the new assured pension scheme.

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The pension scheme was first implemented by the UDF government under Oommen Chandy in 2013. It applied to employees appointed from April 1, 2013, onwards. Employees appointed before that continue to receive a statutory pension, calculated as 50% of the average salary of the last 12 months of service.

The new assured pension scheme will offer the same benefits, with the only difference being that employees must contribute a share. Pension amounts will also be adjusted to account for employee contributions, ensuring that employees are not disadvantaged.

Currently, around 6,000 employees who retired after 2013 receive a minimal pension under the NPS. Discussions are ongoing about how these retirees will be integrated into the assured pension scheme and whether they should contribute.

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Employee organisations have demanded the complete withdrawal of the NPS, but Kerala, like Tamil Nadu, has decided to continue NPS alongside the new scheme. Funds already accumulated under NPS will not be withdrawn.

The pension age under NPS is 60, and it will remain the same under the new scheme. Decisions are still pending on family pension benefits, such as what percentage should be provided to the family if a pensioner passes away. In Tamil Nadu, this is 60% of the last pension received.