NATIONAL PENSION SCHEME (NPS)

This system is mandatory for all new recruits from 01-01-2004. The monthly contribution is 10% of (Basic Pay + DA). Government Contribution is now 14% for Central Government Employees. Both the amount will be deposited in a non-withdrawable tier-I account. No amount towards PF should be deducted. In addition to the above pension account, railway servant may also have a tier-II account at his option. The railway will not make any contribution to tier-II account. The employee can withdraw a part or whole of the amount in tier-II account at any time.

Recoveries towards the contribution to tier-I account will commence from the first of the month following the month in which the employee has joined the service. At the time of appointment, every railway servant have to furnish, in the prescribed format, the details of name, designation, scale of pay, pay, date of birth, nominee for the fund, etc. Each Bill Drawing Officer have to consolidate the above details in respect of all the railway servants who have joined during the previous month and sent it to the associate bill-passing Accounts Officer by 7th of each month.

An unique 16 digit Permanent Pension Account Number (PPAN), in the pattern of:

• 1st to 4th digits -calendar year in which the account is opened
• 5th digit -Ministry code (Railways-5)
• 6th to 8th digits -Zone / Production Unit code
• 9th to 11th digits -Accounts Unit code
• 12th to 16th digits -Employee number (running from January to December)

Once PPAN allotted will not be changed. The Accounts Officer will maintain an index register with all details and enter the PPAN allotted to the new entrants. The PPAN allotted will be intimated to the employee. The Accounts Officer will consolidate the details of new entrants in the prescribed format and send it to FA&CAO by 12th of each month.

When the railway servant is transferred from one accounting unit to another, the balance in the tier-I account will not be transferred. However, in the LPC the PPAN, the month up to which the Employee's contribution and Railway's contribution has been transferred to Pension Fund will be indicated. If the employee is transferred during the month, the recovery under this scheme will be made by the office which draws salary. If the employee dies while in service the entire accumulation under tier-I account will be given to the spouse / dependent.

At the end of each financial year, an annual statement showing the details of deduction and contribution made by the railways along with the interest allowed is prepared. The encashment of leave salary is admissible on account of retirement / death. Under this scheme, the Charge Allowance will be included in the pay. In case of running staff, 30% of pay will be included in the pay.

** Superannuation: If not opted for 60% withdrawal, to get in writing and settlement at the age of 70 years.

** VR/Resignation: To contribute NPS till attains the age for purchase of fund.

Pension is Payable in the order - Subscriber, spouse, living mother and living father. After all the persons, purchase price shall be returned to son/daughter/legal heirs.