Showing posts with label NPS. Show all posts
Showing posts with label NPS. Show all posts

Remittance of NPS funds solely through electronic mode (NEFT/RTGS) from 01st April 2014

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
PFRDA/2014/01/CSG/1
Date: 09th January 2014
To,
All Central Government Ministries & State Governments
Dear Sir/Madam,
Remittance of NPS funds solely through electronic mode (NEFT/RTGS) from 01st April 2014
1. The Circulars no. PFRDA/2013/10/CRTB/1 dated 30th April 2013 and PFRDA/2013/12/CRTB/2 dated 31″ May 2013 may be referred.

2. It has been observed that the following problems are presently being faced on account of remittance of NPS contribution funds through physical instruments:
a.) Higher percentage of rejection of contributions/ funds return
b.) Delays due to cheque clearing activity
c.) incidences of cheque rejection due to financial/ technical reasons.

3. All the aforementioned issues affect the timely investments of the subscribers thus adversely impacting their pension corpus accumulation. To obviate the aforesaid concerns, and in compliance of CVC instructions issued vide Office Order No. 20/4/04 File No. 98/ORD/1 dated 06-04-2004 PFRDA has decided to discontinue the remittance of NPS contribution funds through physical instruments and to accept remittance solely through electronic mode from 01st April 2014.
 
4. Accordingly from 01st April 2014 onwards, all the nodal offices remitting NPS contributions have to mandatorily remit NPS Contributions through electronic mode i.e. NEFT/ RTGS only.

5. The overall procedure for remittance of funds to Axis Bank (Trustee Bank), matching & booking of SubscriberContribution Files (SCFs) and the receipt of funds from it shall remain unchanged.
6. This circular may be sent to all the nodal offices under your jurisdiction for necessary action/ compliance.
7. The contact details of NPS Cell at Axis Bank is as follows:
First Level of Contact:
S No.
Contact Person
Designation
Phone No.
1
Mr Abhishek Gautam
Senior Manager
022-24253678
2
Mr Dakshesh Barbhaya
Senior Manager
022 24253639
3
Mr Yash Mayekar
Senior Manager
022 24253628

Second Level of Contact:
S No.
Contact Person
Designation
Phone No.
1
Mr Debraj Saha
Assistant Vice President
011 43506532
2
Mr Piyush K Singh
Deputy Vice President
022 24253680
The Circular has also been placed on PFRDA website at http://www.pfrda.org.in
Yours faithfully,
sd/-
(Ashish Kumar)
General Manager
Source: https://www.npscra.nsdl.co.in/download/Remittance-Update.pdf


PFRDA proposes partial withdrawal to make NPS attractive

Partial withdrawals are currently not allowed under the NPS and a subscriber has to completely exit from the scheme subject to certain conditions on the utilization of the amount.

New Delhi: To make the national pension system (NPS) more attractive, the Pension Fund Regulatory and Development Authority (PFRDA) has published draft rules that will, if implemented, allow subscribers to withdraw funds partially to meet major expenses such as those related to treatment of certain diseases and education.

Under the proposed guidelines, a subscriber can withdraw as much as 25% of the accumulated funds for marriage of children, purchase of property, higher education and treatment of ailments such as cancer and paralysis.

Partial withdrawals are currently not allowed under the scheme and a subscriber has to completely exit from the scheme subject to certain conditions on the utilization of the amount.

PFRDA administers the NPS for Union and state government employees and the unorganized sector.

The move will make the pension scheme attractive vis-a-vis insurance and the employee provident fund (EPF), where partial withdrawals are possible. The pension scheme for unorganized sector has failed to gain popularity since its launch in May 2009.

The approval of the PFRDA Bill last year by Parliament has paved the way for the restructuring of some of the features of the NPS to make it more attractive. The PFRDA Act, 2013, provides for partial withdrawals, not exceeding 25% of the contribution made by the subscriber.

“This flexibility is positive and will help in increasing the popularity of this scheme,” said Suresh Sadagopan, a certified financial planner at Ladder7 Financial Advisory, a Mumbai-based financial planning firm. “The fact that PFRDA has restricted the withdrawal to 25% of the accumulated amount is also good. Ultimately, it is a scheme meant for retirement savings. If higher withdrawals would have been permitted, the situation would have been a repeat of EPF, where more than 80% of the accounts have less than Rs.20,000 in them.”

The new law also gives the pensions regulator statutory and punitive powers, similar to that of the Securities and Exchange Board of India, the Reserve Bank of India and the Insurance Regulatory and Development Authority.

The government is in the process of revamping the pension fund regulator. It is also shortlisting candidates for the post of the chairman of the pension fund regulator and for the posts of three whole-time members. In November, Yogesh Agarwal, chairman of PFRDA, resigned after being prodded by the finance ministry to quit.

Under the proposed draft guidelines, the subscriber should be in NPS for at least 10 years and regularly contribute to the scheme. Also, the subscriber will only be allowed to withdraw for a maximum of three times and that too with a gap of five years between two withdrawals. However, in case of illnesses, the mandatory gap between withdrawals will not apply.

“We are proposing the above frequency in order to make sure that the subscriber should be left with a decent and considerable accumulated pension wealth at the time of superannuation/age of 60 years enabling him to purchase sustainable annuity,” PFRDA said.

According to the current rules, a subscriber can exit the NPS on retirement or on attaining 60 years. In this case, at least 40% of the accumulated funds have to be mandatorily used to purchase an annuity with the balance paid as a lump sum amount. In case the exit is before retirement or before 60 years of age, at least 80% of the funds have to be used for purchase of an annuity and only the balance is paid as a lump sum.

Courtesy:www.livemint.com

PFRDA Circular;Accounting Policy for Inflation Linked Bonds

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
 
CIRCULAR

File No.: PFRDA/2013/19/PFM/5

Date: 11th Dec. 2013


To,
 
All Pension Funds

Subject: Accounting Policy for Inflation Linked Bonds
 
   1. Inflation Indexed Bonds (IIB) 2013-14 issued by RBI has a fixed real coupon rate and a nominal principal value that is adjusted against inflation. Coupons will be paid on adjusted principal and on maturity, the adjusted principal or face value (whichever is higher) will be paid. For providing inflation protection, Final Wholesale Price Inflation (WPI) will be used with four months lag.

FAQ regarding New Pension Scheme in Ordnance Factories

OFFICE OF THE PRINCIPAL CONTROLLER OF ACCOUNTS(FYS)
10-A, S K BOSE ROAD. KOLKATA – 700001

NPS Section

Questionnaire regarding New Pension Scheme :-

1.What is New Pension Scheme ?

   A new defined contribution pension system in place of existing defined benefit system, applicable for fresh entrants to Central Government Service from 01-01-2004.

2. When it is started & for whom ?

   The system is mandatory for all new recruits to the Central Government Service from 01-01-2004 except the Armed Forces.

3.What is the quantum of the Contribution ?

   The monthly contribution to be deducted amounts to 10% of the Basic Pay, Grade Pay and DA to be paid by the employee & matched by the Central Government.

Regarding withdrawal from the NPS on death of by the employees who have been allotted PRAN and their contribution uploaded to NSDL.

KENDRIYA VIDYALAYA SANGATHAN
18-INSTITUTIONAL AREA,
SHAHEED JEET SINGH MARG,
NEW DELHI - 110016

F.NO.110126125/2012/KVS-NPS/PF

Dated: 06.11.2013

The Deputy commissioner/Director
Kendriya vidyalays Sangathan
All Regional Office & ZIETs

Subject : Regarding withdrawal from the NPS on death of by the employees who have been allotted PRAN and their contribution uploaded to NSDL.

Sir/Madam,

   The Pension Fund Regulatory and Development Authority (PFRDA) has now provided the interim procedure for withdrawal requests of employees arising out of the subscriber’s death. The PFRDA approved Withdrawal Form 103GD with Form 401 AN(Annexure) along with supporting documents are enclosed as annexure (Annexure—B). You are requested to follow the process as advised by PFRDA. The Withdrawal Form 103GD with Form 401 AN (Annexure) along with the supporting documents are to be submitted through to the Exceptional Handling Cell — CRA.

FAQ by Pensioners Portal New Pension Scheme (NPS)

Frequently Asked Questions (FAQs)
(Central Civil Pensioners)
(Last updated/Reviewed: 04.11.2013)

NEW PENSION SYSTEM

NPS.1 The CCS(P) Rules are applicable to govt. servants appointed on or before 31.12.2003.Are the employees who joined pensionable establishments of Govt. of India after 31/12/2003 eligible for any benefits under these rules?

   In accordance with DoP&PW O.M. No. 38/41/06-P&PW(A) dated 5.5.2009 such employees who joined after 31/12/2003 and/or their families may be given the benefit of disability pension or family pension provisionally till the finalization of rules under the National Pension System (NPS) on death/injury.

Offer Document for NPS-All Citizen Model-Revised

National Pension System (NPS)
 
   Pension Fund Regulatory and Development Authority (PFRDA) originally established by the Government of India through a resolution dated 10th October, 2003 & 14th November, 2008, has since attained a statutory status post the passage of Pension Fund Regulatory and Development Authority Act, 2013. In accordance with the provisions of the said Act PFRDA is mandated to promote old age income security by establishing, developing and regulating pension funds, to protect the interest of the subscribers to the schemes of pensions funds and for matters connected therewith or incidental thereto.
 
   PFRDA has established the institutional framework and infrastructure required for administering the ‘National Pension System’ (NPS) for government employees as well as other citizens of India. For servicing of NPS subscribers, various intermediaries such as Central Recordkeeping Agency (CRA), Pension Fund Managers (PFMs) for professional management and investment of subscriber funds, Points of Presence (POP’s) for distribution of the product, Trustee Bank, Custodian and NPS Trust have been appointed and are functional.

Lok Sabha Passes Pension Fund Regulatory and Development Authority(PFRDA) Bill, 2011 with official amendments;

   Lok Sabha Passes Pension Fund Regulatory and Development Authority Bill, 2011 with official amendments; Subscribers Seeking Minimum Assured Returns Allowed to OPT for Investing their Funds in such Scheme Providing Minimum Assured Returns

   The Pension Fund Regulatory and Development Authority Bill (PFRDA), 2011 was passed by the Lok Sabha today with official amendments. It was earlier introduced in Lok Sabha on the 24th March, 2011 to provide for a statutory regulatory body the Pension Fund Regulatory and Development Authority (PFRDA) under the provisions of the Bill. The legislation seeks to empower PFRDA to regulate the New Pension System (NPS).

   The PFRDA Bill, 2011 was referred to the Standing Committee on Finance on the 29th March, 2011 for examination and report thereon. The Standing Committee on Finance gave its Report on 30th August, 2011. Some of the key amendments incorporated in the Bill based on the recommendations of the Standing Committee on Finance are as follows:

Portability of PRAN – NPS Lite/Swavalamban to NPS – All Citizen Model and other sectors.

Pension Fund Regulatory and
Development Authority

CIRCULAR

PFRDA/2013/13 /PDEX/ 08 

              20th August’2013

Subject: Portability of PRAN – NPS Lite/Swavalamban to NPS – All Citizen Model and other sectors

   There were several requests from NPS Lite/Swavalamban subscribers seeking  porting of their PRANs from NPS Lite/Swavalamban to the All Citizen Model of NPS (UOS). PFRDA after examining the matter has approved the shifting/porting of  NPS/Lite/Swavalamban accounts to NPS-All Citizen model and other Sectors through an Inter platform shift process which is detailed as below:

   1. The subscriber has to submit the following documents to the new nodal office (POP/PAO/DDO etc) who in turn will process the application and forward the document to CRA.

   a. Duly filled in Inter platform shift (IPTR-1) form along with the duly filled in registration form of the sector to which he wishes to migrate.

Additional Relief on death/disability of Government Servants covered by the Defined Contribution Pension System (NPS).

1(7)1/DCPS(NPS)/2009/TA/295
MINISTRY OF FINANCE
DEPARTMENT OF EXPENDITURE
CONTROLLER GENERAL OF ACCOUNTS
7th FLOOR, LOK NAYAK BHAWAN
NEW DELHI

Corrigendum

Dated: 27/05/2013

Sub:- Additional Relief on death/disability of Government Servants covered by the Defined Contribution Pension System (NPS)

   Reference is invited to this office OM No.1(7)/DCPS (NPS)/2009/TA/221 dated 02.7.2009 on the above mentioned subject. The existing para No. 3(xix) of the above OM has been substituted by the following:-

   "(xix). The Pension Account holding bank will be responsible for obtaining periodical certificates such as Life Certificate, Re-employed Certificate etc. (as prescribed in CPAO’s Scheme for Payment of Pensions to Central Government Civil Pensioners through Authorised Banks and intimated electronically to CPAO on due dates. (Life certificate should be obtained by 1st November each year and intimation uploaded on CPAO’s website). Drawing of pensions/family pensions will be subject to the receipt of Life Certificate by CPAO".

Sd/-
(Chandan Mishra Dwivedi)
Dy. Controller General of Accounts

Source:http://cga.nic.in/forms/OrderList.aspx?Id=29

National Pension System (NPS) KYC document required for entry & exit and PAN Card mandatory for Tier II Account

CIRCULAR

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

PFRDA/ 2013/11/ PDEX/7

May 22, 2013

To,
All POP’s, Aggregators, CRA, Central and State Governments,

Dear Sir/ Madam,

Sub: 1. KYC documents required for entry & exit of National Pension System – Addendum

        2. Making PAN Card a Mandatory requirement for opening and operation of Tier II account

   Pursuant to PFRDA’s earlier circular no PFRDA/2013/1/PDEX/25 dated 11.01.2013 with respect to revised list of Know Your Customer (KYC) documents required for both entry and exit under National Pension System, it has been decided to include below mentioned documents in addition to the acceptable KYC documentation, on the basis of feedback received from various entities registered under NPS:


Identification Proof

Identity card issued by Central/State government and its Departments, Statuary/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, Public Financial Institutions, Colleges affiliated to Universities and Professional Bodies such as ICAI, ICWAI, ICSI, Bar Council etc.


Address Proof

The identity card/document with address, issued by any of the following:
Central/State Government and its Departments, Statuary/Regulatory Authorities, Public Sector Undertakings, Schedules Commercial Banks, Public Financial Institution for their employees.

   2. It has also been decided to make submission of PAN Card a mandatory requirement for opening and operation of a Tier II account for all sectors under NPS with immediate effect to ensure compliance with AML/CFT guidelines.

   In pursuance of this, all existing Tier II accounts under NPS need to be made PAN compliant. The subscribers would be given a time period of 3 months from the date of issuance of this circular, after which the operation of such account would be suspended till the requirement is complied with.

   This is for the information of all concerned. The circular has also been placed on PFRDA website at http:www.pfrda.org.in and CRA website at http:www.npscra.nsdl.co.in.

Yours faithfully,

Sd/-
Venkateswarlu Peri
General Manager

Source:http://pfrda.org.in/writereaddata/linkimages/Revised%20KYC%20documents%20for%20entry%20and%20exit%20of%20NPS8617173677.pdf

Appointment of new Trustee Bank (TB) under National Pension System (NPS)-reg.

Circular

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

PFRDA/2013/10/CRTB/1

30th April, 2013

To
All Central Government Ministries & State Governments
All PrAOs / PAOs / DTAs / DTOs
All POPs / POP-SPs / Aggregators / Corporates
All PFMs / ASPs

Dear Sir/ Madam,

Subject: Appointment of new Trustee Bank (TB) under National Pension System (NPS)-reg.

   1. All the offices are hereby informed that Axis Bank has been appointed as a new Trustee Bank in place of Bank of India (the current Trustee Bank) for National Pension System (NPS) with effect from 1st July, 2013.

   2. Accordingly, all NPS related funds are to be remitted to the designated accounts of Axis Bank from 1st July, 2013. The Offices shall continue to remit funds to the designated NPS Trust accounts being maintained with the current Trustee Bank, i.e., Bank of India till 30th June, 2013.

   3. Kindly note that the overall procedure for remittance of funds to the Trustee Bank and Matching & Booking of Subscriber Contribution Files (SCF) as well as the receipt of funds from Trustee Bank shall remain unchanged.

   4. The Offices are requested to take note of the same. A detailed circular communicating the new NPS Trust Account numbers where the funds will have to be remitted from 1st July, 2013 and the name, contact numbers and email ids of the Axis Bank officials for any query/assistance will be communicated subsequently.

Yours faithfully

Sd/-
(Subroto Das)
Chief General Manager

Source:http://pfrda.org.in/writereaddata/linkimages/Appointment%20of%20TB7841226642.pdf

INVESTMENT GUIDELINES FOR PRIVATE SECTOR NPS.

INVESTMENT GUIDELINES FOR PRIVATE SECTOR NPS

1. Guidelines

1.1 The PF will manage the following separate schemes, each investing in a different asset class, being:

  1.1.1. Asset class E (equity market instruments) — (a)The investment by an NPS participant in this asset class would be subject to a cap of 50%. This asset class will be invested in shares of the companies which are listed in Bombay Stock Exchange or National Stock Exchange and on which derivatives are available or are part of BSE Sensex or Nifty Fifty Index. subject to restrictions outlined in Clause 2 below

   (b)The permitted cap, as mentioned above, is expected to be maintained at that level at all points in time. However, the amount of funds invested in that asset class can differ from the specified cap by no more than 5% for purposes of portfolio balancing.

   1.1.2 Asset class G (Government Securities) — This asset class will be invested in central government bonds and state government bonds subject to restrictions outlined in Clause 2 below.

   1.1.3 Asset class C (credit risk bearing fixed income instruments) — This asset class contains bonds issued by any entity other than Central and State Government. This asset class will be invested in Fixed deposits and credit rated debt securities. This includes rated bonds/securities of Public Financial Institutions and Public sector companies, rated municipal bodies/infrastructure bonds and bonds of all firms (including PSU/PSE), subject to restrictions outlined in Clause 2 below.

   1.1.4 Corporate CG – Presently applicable to only SBI Pension Funds Private Ltd, UTI Retirement Solutions Ltd & LIC Pension Fund Ltd. and replicates the scheme as applicable to Central Government employees and subject to instructions from PFRDA/NPS Trust in this regard from time to time.

   1.1.5 NPS Lite – Investment pattern similar to that prescribed by the Central Government for its own employees as amended from time to time (charges applicable as per Schedule VII).

   1.2 The PF must not leverage the portfolio. For the purpose of this Schedule, the PF shall be deemed to have leveraged the portfolio if it:

   1.2.1 enters into borrowings or other financial arrangements or creates or purports or attempts to create any security, charge, mortgage, pledge, lien or encumbrance of any kind whatsoever on the assets of the portfolio or any part thereof;

   1.2.2 undertakes any transaction the result of which would overdraw the account maintained by the Custodian on behalf of the PF for the purpose of settling transactions;

   1.2.3 commits the Trustee to supplement the assets of the portfolio or the account maintained by the Custodian on behalf of the PF for the purpose of settling transactions without the prior written consent of the Trustee by a Proper Instruction, either by borrowing in the name of the PF or the Trustee or by committing the PF or the Trustee to a contract which may require the Trustee to supplement those assets; or

   1.2.4 allows market movement to result in a leveraged position.

2. Investment Universe

2.1 Asset class E (equity market instruments)

2.1.1 Authorised Investments

   Investment in shares of the companies which are listed in Bombay Stock Exchange or National Stock Exchange and on which derivatives are available or are part of BSE Sensex or Nifty Fifty Index.

2.1.2 Restrictions

   a. the assets are not to be encumbered.

   b. the PF shall buy and sell securities on the basis of deliveries and shall in all cases of purchases, take delivery of relative securities and in all cases of sale, deliver the securities and shall in no case put itself in a position whereby it has to make short sale or carry forward transaction or engage in badla finance (except as permitted under the extant regulations, from time to time).

   c. the investment exposure in an industry sector (classification as per NIC classification) shall be restricted to 15% of all NPS schemes portfolio of each PFM .

   d. the investment in any equity stock of a sponsor group shall be restricted to 5% of the paid up equity capital of all the sponsor group companies or 5% of the AUM of the concerned NPS scheme (Tier I and ll taken together) , whichever is lower. The investment in equity stock of the investee company of sponsor group shall be restricted to 5% of the paid up equity capital of the concerned investee

   company of the sponsor group or 5% of the AUM of the concerned NPS scheme (Tier I and ll taken together) , whichever is lower

   e. the investment in any equity stock of a non-sponsor group shall be restricted to 10% of the paid up equity capital of the concerned group companies of a non- sponsor group or 10% of the AUM of the concerned NPS scheme (Tier I and II taken together) , whichever is lower. The investment in any equity stock of the concerned investee company of non-sponsor group shall be restricted to 10% of the paid up equity capital of the investee company of a non- sponsor group or 10% of the AUM of the concerned NPS schemes (Tier I and ll taken together) whichever is lower.

   f. investment in IP0s/FPOs is not allowed

   g. investment in unlisted equity shares or equity related instruments is not permitted except in derivatives for the purpose of hedging and portfolio balancing only in accordance with the guidelines issued by SEBI/RBI

   h. no loans for any purpose can be advanced by the PF.

   i. pending deployment of funds of a scheme in securities in terms of investment objectives of the scheme, funds may be invested in short-term deposits of schedule commercial banks or in call deposits or in short term money market instruments or other liquid instruments or liquid schemes of mutual funds not exceeding a limit of 10% of the scheme corpus on temporary basis only.

2.2 Asset class G (Government Securities)

2.2.1 Authorised Investments

   1. Government of India Bonds

   2. State Government Bonds restricted to 10% of the AUM of the Scheme and 5% to any individual state government

2.2.2 Restrictions

   a) the assets are not to be encumbered

   b) no loans for any purpose can be advanced by the PF.

   c) pending deployment of funds of a scheme in securities in terms of investment objectives of the scheme, funds may be invested in short-term deposits of schedule commercial banks or in call deposits or in short term money market instruments or other liquid instruments or liquid schemes of mutual funds not exceeding a limit of 10% of the scheme corpus on temporary basis only.

   2.3 Asset class C (credit risk bearing fixed income instruments)

 2.3.1 Authorised Investments

   (i) Fixed Deposits of not less than 365 days of scheduled commercial banks with following filters:

   a) Net worth of at least Rs.500 crores and a track record of profitability in the last three years.

   b) Capital adequacy ratio of not less than 9% in the last three years. Net NPA of under 5% as a percentage of net advances in the last year

   c) List to be reviewed half-yearly

   (ii) (a) Debt securities with maturity of not less than three years tenure issued by Bodies Corporate including scheduled commercial banks and public financial institutions [as defined in Section 4 (A) of the Companies Act]

   (b) Provided that at least 75% of the investment in this category is made in instruments having an investment grade rating from at least two credit rating agency. Apart from the ratings by agencies, PFM shall undertake their own due diligence for assessment of risks associated with the securities before investments

   (iii) Credit Rated Public Financial lnstitutions/PSU Bonds

   (iv)Credit Rated Municipal Bonds/Infrastructure Bonds/Infrastructure Development Funds.

Investment Restrictions

   1. The assets are not to be encumbered

   2. The investment exposure in an industry sector (classification as per NIC classification) shall be restricted to 15% of all NPS schemes portfolio of each PFM.

   3. The investment exposure in debt securities of a sponsor group shall be restricted to 5% of the net worth of all the sponsor group companies or 5% of the AUM of the concerned NPS scheme (Tier I and ll taken together), whichever is lower. The investment exposure in debt securities of the investee company of sponsor group shall be restricted to 5% of the net-worth of the concerned investee company of sponsor or 5% of the AUM of the concerned NPS scheme (Tier I and ll taken together), whichever is lower.

   4. The investment in debt securities of a non-sponsor group shall be restricted to 10% of the net worth of all companies of a non- sponsor group or 10% of the AUM of the concerned NPS scheme (Tier I and ll taken together), whichever is lower. The investment in debt securities of the investee company of non-sponsor group shall be restricted to 10% of the net worth of the concerned investee company of a non- sponsor group or 10% of the AUM of the concerned NPS scheme (Tier I and ll taken together), whichever is lower.

   5. Investment decisions should be taken by PF in the best interest of subscribers with emphasis on safety, prudence, optimum return, sound commercial judgement and avoiding funds to remain idle.

   6. Any moneys received on the maturity of earlier investments reduced by obligatory outgoings shall be invested in accordance with the investment pattern.

   7. In case of any instruments mentioned above, the PF should take all steps to ensure that the interests of the subscribers are not compromised towards this and amongst other steps the investment should be under continuous monitoring and be reviewed from time to time to detect any signal of impairment /downgrade in rating of the security and the PF should take immediate steps to ensure that the interest of the subscriber are protected.

   8. The investment should be made by the PF through a Stock Exchange, or directly with other counterparties in respect of Government Securities and other debt instruments at the best possible rate available at the material time of transactions. The PF shall not purchase or sell securities through any broker (other than an associate broker) which is an average of 5% or more of the aggregate purchases and sale of securities under all schemes, unless the PF has recorded in writing the justification for exceeding the limit of 5% and reports of all such investments are sent to the Trustees on a quarterly basis. Provided that the aforesaid limit of 5% shall apply for a block of three months. The PF shall not utilise the services of the sponsor or any of its associates, employees or their relatives, for the purpose of any securities transaction. A PF may utilise such services only after obtaining prior permission of the Trustees.

   9. NPS Funds shall not be used by the PF to buy securities/bonds held in its own investment portfolio or any other portfolio held by it or in its subsidiary or in its Sponsor.

   10. The PF shall buy and sell securities on the basis of deliveries and shall in all cases of purchase, take delivery of relative securities and in all cases of sale, deliver the securities and shall in no case put itself in a position whereby it has to make short sales or carry forward transactions or engage in badla finance (carry forward).

   11. The PF may enter into derivatives transactions, if it is in the interest of the subscribers’, only for the purpose of hedging and portfolio balancing, in

   accordance with the guidelines issued by SEBI/RBI. These derivatives transactions should be entered into only in recognised stock exchange. Credit default Swap are also approved derivatives for the purpose.

   12. The PF shall enter into transactions relating to Securities only in dematerialised form. The PF shall, for securities purchased in the non depository mode get the securities transferred in the name of the NPS Trust on account of the Scheme.

   13. Transfer of investments from one Scheme to another Scheme in the same PF, shall be allowed only if:-

   13.1 such transfers are made at the prevailing market price for quoted Securities on spot basis (Explanation: spot basis shall have the same meaning as specified by Stock Exchange for spot transactions)

   13.2 the Securities so transferred shall be in conformity with the investment objective of the Scheme to which such transfer has been made.

   14. Pending deployment of funds of a scheme in securities in terms of investment objectives of the scheme, funds may be invested in short-term deposits of schedule commercial banks or in call deposits or in short term money market instruments or other liquid instruments or liquid schemes of mutual funds not exceeding a limit of 10% of the scheme corpus on temporary basis only.

   15. The PF may alter these above stated restrictions from time to time to the extent the PFRDA Regulations change, so as to permit the Schemes to achieve their investment objective.

3. Investment Objectives

   The investment objectives for the three asset classes are outlined below:

3.1 Asset class E

   3.1.1 Benchmark — the performance of the scheme will be measured by reference to the total performance (dividends reinvested) of the BSE Sensex and NSE Nifty 50 Index.

   3.1.2 Performance objective — the investment objective is to optimise returns while investing in the chosen index over a rolling annual basis.

3.2 Asset class G

   3.2.1 Performance objective — the investment objective is to optimise returns.

   3.2.2 Risk — It is expected that the PF will be able to identify and justify the additional risks relative to the return, while managing the portfolio on an absolute return basis.

3.3 Asset class C

   3.3.1 Performance objective — the investment objective is to optimise returns.

   3.3.2 Risk — It is expected that the PF will be able to identify and justify the additional risks relative to the return, while managing the portfolio on an absolute return basis.

4. Allocation of funds across asset class for “Auto choice”

   The methodology for allocating funds in the three asset classes are outlined in the table below which illustrates the allocation of each asset class for “Auto Choice” option based on age of the investor:-

Age

Asset Class E

Asset Class C

Asset Class G

Up to 35 years

50%

30%

20%

36 years

48%

29%

23%

37 years

46%

28%

26%

38 years

44%

27%

29%

39 years

42%

26%

32%

40 years

40%

25%

35%

41 years

38%

24%

38%

42 years

36%

23%

41%

43 years

34%

22%

44%

44 years

32%

21%

47%

45 years

30%

20%

50%

46 years

28%

19%

53%

47 years

26%

18%

56%

48 years

24%

17%

59%

49 years

22%

16%

62%

50 years

20%

15%

65%

51 years

18%

14%

68%

52 years

16%

13%

71%

53 years

14%

12%

74%

54 years

12%

11%

77%

55 years

10%

10%

80%

Source:http://pfrda.org.in/writereaddata/linkimages/INVESTMENT%20GUIDELINES%20FOR%20PRIVATE%20SECTOR%20NPS147808164.pdf

Default ASP and Annuity Scheme for subscribers exiting from NPS and Seeking withdrawal of Accumulated Pension Wealth.

Pension Fund Regulatory and
      Development Authority
        
CIRCULAR

PFRDA/2013/5/PDEX/4

                                 14th February 2013

To,
All POP’s/Aggregators/CRA/ dealing offices of Central & State Governments,

Subject: Default ASP and Annuity Scheme for subscribers exiting  from NPS and Seeking withdrawal of Accumulated Pension Wealth

   PFRDA has empanelled seven Annuity Service Providers (ASP’s) for providing annuity services to NPS subscribers. As per current National Pension System (NPS) exit norms,the subscriber is mandatorily required to select one of the empanelled ASP’s along with an Annuity scheme from those offered by the chosen ASP at the time of exiting from NPS and seeking withdrawal of accumulated pension wealth (for reasons other than death of the subscriber).

   Based on the feedback received from stakeholders seeking provision of a default option to be exercised by the subscriber at the time of selection of the ASP and choosing of an annuity scheme, PFRDA has examined the matter and decided to assist the subscriber by providing a default option.

     After examining the various options provided by the different ASPs, it has been decided to provide for a default ASP and annuity scheme as below:

   1. Default Annuity Service Provider – Life Insurance Corporation of India

   2. Default Annuity Scheme - Annuity for life with a provision of 100% of the annuity payable to spouse during his/her life on death of annuitant’ and Under this option, payment of monthly annuity would cease once the annuitant and the spouse die or after death of the annuitant if the spouse pre-deceases the annuitant, without any return of purchase price.  

   3. However, where the corpus is not adequate to buy the default annuity variant and from  the  default ASP, the subscriber has to compulsorily choose an ASP who offers an annuity at the available corpus in the account of the subscriber.

   Also, it may be noted that this default option is being purely provided in the subscribers’ interest and to avoid any delay in claim processing and is not with a view to endorse/promote any particular ASP or annuity variant being offered by the ASP. 

   The default ASP and the default annuity scheme as above would be applicable for all variants of NPS i.e. Government Sector, Swavalamban and those accounts under NPSlite platform not able to meet the compulsory contribution under Swavalamban scheme, Corporate and All Citizen model.

   This is for the information of all concerned.   The circular has also been placed on PFRDA website at  http://www.pfrda.org.in and CRA website at http://www.npscra.nsdl.co.in.

Yours Faithfully,

Sd/-
  Venkateswarlu Peri
General Manager

Source:http://pfrda.org.in/writereaddata/linkimages/Default%20ASP%20and%20Annuity%20Variant487123241.pdf

Revision in documentary requirements in case of exits arising from Death of the subscriber under NPS-Swavalamban.

CIRCULAR

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

PFRDA/2013/3/PDEX/3 

                                            Date: 06/02/2013

To,
Dear Sir/Madam,

Subject:   Revision in documentary requirements in case of exits arising from Death of the subscriber under NPS-Swavalamban.

   Attention of all stakeholders is invited to the requirement of Death Certificate in original for claiming the benefits of the accumulated pension wealth in the account of a deceased subscriber by the nominee/legal heirs under National Pension System (NPS).

   Basing on representations from some of the stakeholders, the matter has been re-examined in light of the difficulties faced by subscribers in obtaining several sets of original death certificates.   

   It has been now decided that “a certified copy of the death certificate duly attested by the Aggregator/ POP (with the Aggregator/ POP having seen the original of death certificate and returning the same to the nominee/legal heirs) would be acceptable as sufficient proof of death of the subscriber for settlement of death claims arising from NPS-Swavalamban accounts only”.  The Aggregator/ POP in such cases have to specifically certify the copy of the death certificate with wording “ORIGINAL SEEN AND VERIFIED”.

   This is for the information of all concerned.

   The circular has also been placed on PFRDA website at  http://www.pfrda.org.in and CRA website at http://www.npscra.nsdl.co.in

Yours Faithfully

Sd/-
Venkateswarlu Peri
General Manager

Source:http://www.pfrda.org.in/writereaddata/eventimages/revison%20of%20doc%20req%20NPS%20Swavalamban8093653445.pdf

Fixed Medical Allowance to railway beneficiaries of New Pension Scheme drawing additional relief on death /disability of railway servants.

GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
(RAILWAY BOARD)

No. PC-VI/ 311  
No. PC-V/2010/A/Med./1

RBE No. 05/2013. 
New Delhi, dated 22-01-2013.

The General Manager
All Indian Railways & Pus
(As per mailing list)

Sub:- Fixed Medical Allowance to railway beneficiaries of New Pension Scheme drawing additional relief on death /disability of railway servants.

   The Fixed Medical Allowance (FMA) is granted,to Railway pensioners/family pensioners in terms of instructions, contained in Board’s letter dated 21-4-99, 1-3-2004 and subsequent clarifications issued from time to time.

   Grant of FMA to the railway beneficiaries of NPS drawing additional relief on death /disability of railway servant in terms of Board’s letter No. 2008/AC-II/21/19 dated 29-5-2009 has been examined in consultation with Department of Pension and Pensioners’ Welfare. Since in terms of para 602 of IRMM-2000, railway employees are entitled for medical attendance and treatment facilities, free of charge, the NPS railway pensioners drawing additional relief on death/disability of Railway servant in terms of Board’s letter dated 29-5-2009 and staying beyond 2.5 KMs from the nearest Railway Hospital/Health unit can get a RELHS card by paying necessary amount to enable them to obtain indoor treatment. They are also entitled to draw FMA as fixed by the Government. The necessary amount for getting RELHS Card as prescribed in Board’s letter No. 2003/H/28/1/RETES dt. 16.3.2009 are as under:-

(i) The employees who have already retired A sum equivalent to double the amount of revised basic pension after the implementation of VIth CPC.
(ii) Family pensioners A sum equivalent to double the amount of revised family pension after the implementation of VIth CPC

   As and when the Health Insurance is introduced in Railways, the New Pension Scheme railway pensioners would be shifted to the Health Insurance Scheme.

   3. These orders are issued with the concurrence by Health and Finance Directorates of the Ministry of Railways.

   4. Hindi version is enclosed.

sd/-
[N.P. Singh]
Dy. director, Pay Commission-V
Railway Board

Source:- NFIR

Withdrawal process/Exit Guidelines for NPS employees.

PROCEEDINGS OF THE GOVERNMENT OF KARNATAKA

              Sub:- Withdrawal process/Exit Guidelines for NPS employees.

             Read:- 1. G.O. No.FD (Spl) 04 PET 2005, dated 31.03.2006
                         2. G.O. No.FD (Spl) 28 PEN 2009, dated 29.03.2010
                         3. G.O. No.FD (Spl) 01 PEN 2010, dated 20.10.2010                                       
                                                            ---
Preamble:- 

         Government of Karnataka has introduced a Defined Contribution Pension System known as New Pension system/scheme for its employees joining Government service on or after 1.4.2006 vide G.O. read at above (1) & (2) above.  This system/scheme is made operational from 1.4.2010 and the NPS is made applicable for the members of the All India Services (Karnataka cadre) joining the All India Service on or after 1.4.2004, in
G.O. read at (3) above.

         This G.O. is issued to detail the procedure for withdrawal of employees from the scheme before  attaining the age of superannuation and settlement of claims of the NPS employees in case of death while in service or on attaining the age of superannuation.

                       GOVT. ORDER NO. FD (Spl)  203  PEN 2012    
                   BANGALORE,  DATED 16th January 2013

       Government are pleased to  issue the following orders for the NPS employees:

          a. Upon  Normal  Superannuation: At least 40%  of the accumulated  pension corpus of the subscriber needs to be utilized for purchase of an annuity providing for the monthly  pension  of  the subscriber and  the balance is paid as a lump sum to the subscriber.

          b. Upon Death: The  entire accumulated  pension corpus (100%) would  be paid to the nominee/legal heir of the subscriber  and  there  would  not  be  any  purchase of annuity/monthly pension required.

          c. Exist from NPS before the age of Normal Superannuation (irrespective of cause):  At  leaset  80% of  the  accumulated pension  corpus   of   the subscriber needs  to  be  utilized for purchase of an annuity providing  for the monthly pension of the  subscriber  and  the  balance is paid as a lump-sum to the subscriber. 

                                                     BY ORDER AND IN THE NAME OF THE 
                                                      GOVERNOR OF KARNATAKA
            
   sd/-
                                                                    (PADMAVATHI)
                                                              Special Officer & Ex-officio,
                                                         Deputy Secretary to Government,
                                                            Finance Department. (Pension)

Source:http://www.kar.nic.in/finance/pension/FD(Spl)203PEN2012.pdf