Bigger retirement kitty for central govt employees along with tax benefits

Central government employees will now have the freedom to choose their pension fund managers

The Union Cabinet in its meeting on December 6, 2018, approved the proposal to enhance the mandatory contribution by the central government for its employees covered under the National Pension System (NPS) tier-I schemes, from the existing 10 per cent to 14 per cent of basic salary. This, along with a few other changes, is expected to enhance the popularity of NPS. 

“A 4-percentage-point higher contribution by the central government over a 30-35-year span will raise the corpus employees end up with and enhance old-age security when lifespans are rising,” says Sumit Shukla, chief executive officer, HDFC Pension Fund Management.