DDOs asked to submit report on missing NPS contributions
Source: Chronicle News Service

Imphal, January 05 2023: Following complaints from employees of the state government regarding their missing contribution to the National Pension Scheme (NPS), the director of treasury and accounts has issued a directive to all the DDOs of different departments to submit relevant reports.

In the official communication sent to DDOs, the director said that missing credit is a loss to the subscriber(s) in terms of interest and total pensionary wealth accretion and this has been viewed very seriously by the Pension Fund Regulatory and Depository Authority (PFRDA), New Delhi.

It has been noted that several DDOs have been submitting information on missing credits on a piecemeal basis/case by case basis, instead of compiling information of all employees (with missing credits) under his/her office, which has not helped in resolving the issue in a comprehensive manner.

The nodal office has examined the issues of missing credits and it has been observed that missing credits is due to combination of two or more months of NPS contribution in one payment-month (salary-month), duplicate PRAN of the employee or invalid PRAN of the employee.

The actual credit of the above missing NPS credits of employees in their PRAN accounts is dependent on the release of matching government share for NPS contribution, it added.

In order to address all issues of missing NPS credits (for the period up to December 2021), all DDOs (having employees with missing NPS credits up to December 2021) shall provide information of missing credits of the NPS subscribers under their respective offices to the directorate of treasuries & accounts, Lamphelpat, the official communication said.

Meanwhile, some employees, on condition of anonymity, disclosed that NPS contributions for several months are missing from their accounts, which amount to over Rs 1 lakh each.

While the number of missing months spread over several years, they have not received credit for the entire 2022 except for one month.

Contribution is made by the employer (government) after deduction of 10 per cent of their salaries and the employer making a contribution of similar amount.

Even though their shares of contribution are deducted from their salaries every month, there are several missing contributions, the employees said.

They further pointed out that the working principle of NPS is accumulation of a pension fund for the subscriber through regular monthly contribution.

The contributions accumulate over a period of time till retirement grows with market linked returns.

As such, having missing credits results in loss of return (interest) and affects the wealth accretion.

They drew attention of the authority concerned to address the issue and ensure credit of missing contribution is up to date.

Mention may be made here that in her budget speech in February last year, union finance minister Nirmala Sitharaman proposed to increase the tax deduction limit from 10 per cent to 14 cent on employer's contribution to the NPS account of state government employees as well in order to provide equal treatment to both central and state government employees.

This process would help enhance the social security benefits of the state government employees and bring them at par with central government employees, the minister had stated.

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