CPS Scheme Complete Information
1. Introduction:Vide G.O.Ms.No.653 Finance (Pen-I) Dept. Dt:22.09.2004, State Government have introduced CPS to all the employeesrecruited on or after 01.09.2004 on the same lines of Government of India’s New Pension System. The scheme isapplicable to all the organizations covered under A.P. Revised Pension Rules, 1980. Accordingly, each employee who is recruited on or after 01.09.2004 shall pay a monthly contribution of 10% of the basic pay and DA from the salary and State Government will make a matching contribution foreach employee who contributes to the scheme.
2. PFRDA :The Central Government has constituted the Pension Fund Regulatory and Development Authority (PFRDA) to act as regulator for the pension sector of the entire Nation and also to protect the interest of the subscribers of pension fund and for matters connected herewith or incidental thereto.
3. NSDL (CRA) :The PFRDA has appointed the National Securities Depository Limited (NSDL), Mumbai as the Central Record Keeping Agency (CRA) to maintain the records of Contribution and its deployment in various pension fund schemes for the employees.
4. Pension Fund Managers (PFMs) :The SBI, LIC and UTI have been selected as Pension Fund Managers (PFMs)for investing the CPS funds at the rates of40%,31% and 29% respectively. NPS Trust has been set up as Trustee for CPS funds and the Bank of India has been appointed as Trustee Bank
.5. Final payment procedure :At the time of retirement, the employee would be required to invest 40% of the pension wealth to purchase an annuity which will provide pension for life time to the employees and in the event of his death to his dependent parents/spouse. The remaining 60% pension wealth would be paid to the employee at the time of his retirement to utilize in any manner.
6. Clarification regarding payment of Family pension to the spouse of CPS employee while in service :Family pension under New Pension Scheme shall be paid in death cases provisionally pending framing of rules regulating such cases and the payment made on such a provisional basis shall be adjusted against the payment to be made in accordance with the new rules to be framed. Thus, the adjustment of the payment arises only after Government announces the Rules regulating such cases under New Pension Scheme.
7. Role of DTA :The DTA, AP, Hyderabad on behalf of Govt. of A.P. entered into an agreement with the CRA i.e. NSDL on 21.11.2008 and NPS Trust on 15.09.2009. Nodal officers such as DDOshave to deduct CPS contribution from the monthly pay bills of employees. The treasuty Officer have to upload the CPS contributions to the CRA i.e. NSDL and the corresponding amounts have to be transferred to Trustee bank i.e Bank of India. From the Pension Trust, the funds transferred to the Pension Fund Managers for investing the funds in various schemes.
8. Registration Procedure :As per NSDL norms, the employees and the nodal officers of the state who have to make transactions of CPS are necessarily be registered with NSDL by submitting relevant forms. Initially, DTA by submitting N1 form has got registered with NSDL and subsequently registered all the DTOs/PAOs with NSDL by submitting N2 forms. Subsequently, DDOs were registered with NSDL by submitting N3 forms. For employees registration with NSDL,each employee has to submit S1 form to NSDL.
9. CPS applicability to State Autonomous Bodies:Government vide Circular Memo No.41/01/A2/Pen.I/2012 Dt:18.06.2012 have issued operational guidelines for implementation of CPS for the State Autonomous bodies and all other institutions whose pay and allowances were drawn form Consolidated fund of the State or not but covered under A.P.R.P.Rules, 1980. The DTA will function as facilitator and the organizations have to be registered with NSDL through DTA by forwarding N2 and N3 forms. After this each DDO under the treasury has to be registered with NSDL by submitting N5 and N6 forms.
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