Staff have to shell out 7.5-10% of basic pay towards pension
New government employees will no longer get an assured pension, which is at present 50 per cent of their last drawn salary.
They will be required to shell out 7.5-10 per cent of their basic pay towards pension. While the government will make a similar contribution towards their pension kitty, it will not guarantee any fixed pension.
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According to government officials, the current system of deducting a minimum of 6 per cent of the basic pay towards provident fund will not be applicable to individuals joining government services after October 2.
The finance ministry will soon place a proposal before the Cabinet to operationalise the new pension system.
The officials said the idea behind the new pension was to move away from a defined benefit regime.