Atri Mukherjee News Today

Reverting to old pension scheme is a step backwards, warns RBI article; may lead to unsustainable fiscal stress.

​​While terming the move as a "major step backwards", ​the article - authored by Rachit Solanki, Somnath Sharma, R K Sinha, S R Behera and Atri Mukherjee - said that the cumulative fiscal burden in the case of the OPS could be as high as 4.5 times that of the New Pension Scheme. The views expressed in the research paper are not that of the RBI.

States reverting to the old pension scheme is a "major step backwards" and may take the fiscal stress of states to "unsustainable levels" in the medium to long term, according to an article by RBI staffers.

According to an article in the Reserve Bank of Indias September bulletin, states that revert to the Old Pension Scheme (OPS) could face "unsustainable" fiscal stress. The article states that the cumulative fiscal burden of OPS could be 4.5 times higher than that of the National Pension Scheme (NPS), with an additional burden of 0.9% of GDP annually by 2060. The authors highlight that while OPS may be more attractive to employees, it puts a significant financial burden on the government...