Montek Ahluwalia slams state govts reverting to Old Pension Scheme, terms it ‘absurd idea’

New Delhi: Montek Singh Ahluwalia, the former Planning Commission Deputy chairman on Friday tore into the state governments as well as the proponents of Old Pension Scheme and warned that this could be a ‘recipe for financial bankruptcy’.

Montek Ahluwalia termed the move for bringing back Old Pension Scheme as a regressive step and said that doing so would be resorting to an ‘absurd idea’, given the economic challenges that the country & world is facing today.

Shashi Shekhar Vempati, former CEO of Prasar Bharati took to Twitter and informed about former Planning Commission Deputy Chairman’s open denouncement of the old pension scheme.

Montek Singh Ahluwalia at Book Release event of @gchikermane terms the move by certain opposition ruled state governments to regress to “Old Pension System” as an “absurd idea” and a “recipe for financial bankruptcy” pic.twitter.com/mAQ0Q4QPMM

— Shashi Shekhar Vempati शशि शेखर (@shashidigital) January 6, 2023

It may be noted that many state governments & parties have been rooting for rewinding to the Old Pension Scheme (OPS) and junking the new policy. Punjab’s recently elected AAP govt issued a notification for the implementation of OPS while Congress govts in Rajasthan, Chhattisgarh have already reverted to the old policy.

This is not the first time that Montek Ahluwalia has spoken against the OPS. Sometime back, he said that the OPS was one of the biggest ‘revadis’ offered by the state governments. Notably, PM Modi has often spoken against political parties developing & promoting a culture of free revadis (freebies).

Under the OPS, pension of Central & state govt employees were fixed at 50% of the last drawn basic pay while under the new system of New Pension Scheme, the contribution comprised of 10% of basic salary and dearness allowance by the employee with a matching contribution by the government. The new system came into effect for those employees who joined service from 2004.