nps: Meetings of the 8th pay commission have begun. With this, the demand for the old pension has once again intensified. Employee organizations are continuously demanding the withdrawal of NPS and the restoration of the Old Pension Scheme. However, given the current circumstances, the old PENSION SCHEME appears to be a distant dream. Furthermore, there are few signs of the return of NPS.
What is the Old Pension Scheme?
Under this plan, employees are entitled to a lifelong fixed pension after they retire. This also includes a dearness allowance, meaning that as inflation rises, so does the pension amount.
Why do employees want the old pension scheme back?
At present, the government offers the NPS and UPS to its employees. Nevertheless, there is a persistent demand from employees for the return of the old pension scheme. The main reason for this is social security. The old pension scheme ensures that pensions grow with inflation, which provides considerable financial stability for retirees.
Why is it difficult to switch to the old pension scheme?
In the last two decades, both the government and employees have contributed Rs 16.50 lakh crore to the NPS. As a result, reversing the NPS and going back to the old pension scheme would lead to substantial financial losses. The funds from the NPS are managed through LIC, SBI, UTI, and other government-associated financial institutions, making it impossible to withdraw all funds at once.
Apart from this, if NPS is closed then it will have a bad impact on the liquidity of the market and financial institutions. The government formed the Pay Commission in November 2025. Six months have now passed. The Commission has 18 months to submit its report within this time. The Pay Commission has expedited the process, holding meetings in various parts of the country to prepare a comprehensive report.
There is currently a lot of discussion among employees about fitment factors, as it is the fitment factor that will determine the salaries of government employees. Some employee unions have demanded a fitment factor of 4. It remains to be seen what the Pay Commission recommends.
