A last-minute realisation may have saved the Central government from blowing away the legal cover available to authorities right from the President and Supreme Court judges to ministers and members of Parliament against any orders of attachment of their pensions from the courts.

The government had almost decided to axe the 145-year-old Pension Act in its zealousness to heed the Prime Minister’s call to scrap obsolete laws. But at a meeting held on April 28, minutes of which have been accessed by ET, several ministries pointed out that no other law protects government authorities from seizure or attachment of pension by process of any court at the instance of a creditor who raises a demand against the pensioner.

This led the government to consider doing away with some of the “irrelevant or redundant” provisions of the Pensions Act, 1871 instead of repealing it. The final decision will now be made by Prime Minister Modi, who heads the pensions department of the personnel ministry. The government has so far repealed 125 archaic laws.

It has proposed to scrap over 1,000 more such laws. The representative of the Department of Financial Services (DoFS) said at the meeting that the Pensions Act is applicable to pensions under a large number of rules and Acts of Parliament.

“He specifically mentioned that pensions of the President, vicepresident, ministers and MPs are regulated by Acts of Parliament.

Similarly, pensions of Supreme Court/high court judges, central vigilance commissioners, central information commissioners and members of UPSC are also granted under Acts regulating their service conditions. These Acts of Parliament do not contain provisions securing the pension against attachment,” the minutes recorded.

Only Section 11 of the Pensions Act provides this protection to the constitutional authorities. When the pensions department proposed that the rules regulating various types of pension be amended to secure the pension and hence facilitate repealing of the Pensions Act, all ministries raised objections.

The home ministry “expressed apprehension” that the protection against attachment by courts, if provided in rules, “may not be as effective” as that provided in an Act of Parliament.

The rural development department concurred, saying all social security pensions administered by it are through executive orders and any provisions for security against attachment by court “may not be effective” as the provisions will not have any statutory backing.

The ministries of environment, culture and external affairs, and the departments of telecom, expenditure and posts said they do not even administer any separate pension rules.

The financial services department said the government will have to amend all other Acts and rules regulating various kinds of pension to incorporate the safety net, if the Pensions Act is to be repealed.

It proposed that instead of amending a large number of Acts and rules, the Pensions Act may be amended to repeal only those provisions which have since become irrelevant or redundant.

“Ministries of home, labour, rural development, defence, railways and DoPT endorsed the views of the Department of Financial Services… the aforesaid views of the ministries/departments will be placed before competent authority for taking a decision in the matter,” the minutes noted.

Source: ET

NPS Subscription earns double digit yearly returns for the past 5 years which comparatively higher than EPF interest rates – Central and state government employees covered by the scheme earned between 9.3% and 10.15% during this period.

If the 5 basis point hike in interest rate of the Employees’ Provident Fund (EPF) made subscribers smile, those covered by the New Pension System (NPS) must be laughing.

Most NPS investors earned double-digit returns in the past 3-5 years. Central and state government employees covered by the scheme earned between 9.3% and 10.15% during this period.

The performance of individual schemes is not very helpful because NPS investors put money in a combination of funds. Therefore Economic Times studied the blended returns of four different combinations of the equity, corporate debt and gilt funds. Ultra-safe investors are assumed to have put 60% in gilt funds, 40% in corporate bond funds and nothing in equity funds.

A conservative investor would put 20% in stocks, 30% in corporate bonds and 50% in gilts. A balanced allocation would put 33.3% in each of the three classes of funds while an aggressive investor would invest the maximum 50% in the equity fund, 30% in corporate bonds and 20% in gilts. The table shows the average blended returns of the seven pension funds.

Admittedly, the short-term picture of the NPS is not very encouraging because of the negative returns from stocks in the past one year. Aggressive investors have earned less than 3% and balanced investors made only 4.93%, though ultra-safe investors who stayed away from stocks got 8.89%.

But the long-term picture is different. On average, gilt funds have given 9.75% annualised returns while corporate debt funds have churned out more than 11% in the past five years. As a result, the average return for ultra-safe investors in the past five years is in double digits.

The average NPS fund has given 100-125 basis points more than what the retirement savings of the estimated 3.7 crore EPF subscribers have earned during this period. “Even a 100 basis point higher return can make large impact on the corpus in the long term,” says Sumit Shukla, CEO of HDFC Pension Fund.

Will the good times continue for gilt funds and corporate bond funds? Experts say this trend will not stay forever. “NPS is a long-term investment and the bonds are predominantly held to maturity. Over a longer period, the portfolios will deliver returns similar to the yield-to-maturity of the bonds in the portfolios,” says Manoj Nagpal, CEO of Outlook Asia Capital. The average yield-to-maturity of the bonds is roughly 8.4%, which is higher than the PPF rate but lower than what the EPF offers.

Should you switch from EPF to NPS?

This raises the critical question: should you switch from EPF to the pension scheme? The proposal to switch from EPF to NPS was announced in last year’s budget and this year’s budget extended a onetime tax exemption to such a shift.

A legislation to amend the Employees’ Provident Fund & Miscellaneous Provisions Act has already been framed and is lying with the Law Ministry. The amendment allows EPF subscribers to make a one-time switch to the NPS. Once he shifts to NPS, the employee will have a one-time chance to return to the EPF fold.

But experts believe it may not be a wise move to shift your retirement savings to the NPS because of the difference in tax treatment. While the EPF corpus is completely tax free, this year’s budget has proposed to make 40% of the NPS tax free.

Pension Fund Regulatory and Development Authority (PFRDA) chairman Hemant Contractor says there should be tax parity in all retirement products.

“Why would anybody want to shift his money from the fully tax-free EPF to the NPS where only 40% of the corpus will escape tax? If there is parity in the tax treatment, a lot of subscribers would shift from EPF to NPS,” he told Economic Times recently.

For investors, the tax benefits are an important consideration. The new tax deduction offered on the NPS attracted investors in a big way in 2014-15, with almost 1.2 lakh new voluntary accounts opened during the year. Within nine months, the assets under management of funds for the private sector shot up more than three-fold from Rs 6,361 crore in April 2015 to touch Rs 20,261 crore by December 31, 2015.

Financial advisors see another problem in the NPS. At least 40% of the maturity corpus has to be put in an annuity to earn a monthly pension. Annuity rates in India are very low compared to what other options can offer.

The Senior Citizens’ Saving Scheme, for instance, gives 8.6% returns compared to 6.75% offered by annuities that return the principal after death. The PFRDA wants that the investor should be allowed to look beyond annuities.

Source: The Economic Times

New Delhi: With each passing day, the picture of higher monthly payout for central government employees, than what was recommended by the 7th Pay Commission, is emerging clear.

In a meeting with the BJP's labour wing Bharatiya Mazdoor Sangh, Jitendra Prasad, Union Minister of State for Personnel, Public Grievances, Pensions, told the delegation that government would positively look into the demand of the central government employees. "The minister said we will consider the proposal of minimum pay of at 24,000”, Pawan Kumar, Regional Organizing Secretary told Zee Media Bureau.

The Bhartiya Mazdoor Sangh is the largest central trade union organization in India, and claims to have more than 10 million members.

The trade union also sought increase in the Multiplication Factor and changes in the HRA.

The 7th CPC under AK Mathur had proposed Multiplication Factor of 2.57, according to which the fitment of each employee in the new pay matrix is proposed to be done by multiplying his or her basic pay on the date of implementation by a factor of 2.57.

"We are expecting the notification for implementation of the 7th Pay Commission in the last week of June, and payout to begin in July", added Kumar.

He further assured that DoP&T is actively considering for grant of one time relaxation for compassionate appointment in Ministry of Defence. He added that Bhartiya Mazdoor Sangh has ruled out possibilities of strike to get a better salary revision under 7th Pay Commission. "We are not part of those who say that we will strike"to get a better pay hike, added Kumar. 

As per report, the National Joint Council of Action (NJCA) has decided to serve indefinite strike notice to the Govt on 9th June 2016 and to commence indefinite strike from 11th July 2016, if the Govt fails to come to a negotiated settlement on 7th CPC related issues with the JCM National Council Staff Side.

Union Public Service Commission (UPSC) published final result for Civil Services Main Examination, 2015. This exam was held on December, 2015 and  the interviews for Personality Test held in March-May, 2016.

Final Result : Click Here

Exam was held between 18-12-2015 to 23-12-2015

Personality Test held on : 08-03-2016

In the previous lesson, we have learned in detail about interest withdrawal process (reversal transaction) using HTM. In today’s lesson we will see more uses of HTM menu.

As I said in the previous lesson, we can do all transactions in HTM. Yes! If you don’t believe me try yourself. But since we have dedicated menus for individual transactions let’s not complicate our work by using HTM.

But there are some other cases where we have to use HTM menu. Let’s see 2 such cases.

How many of you got this error “Cash Limit Error” while verifying withdrawal transactions? Do you know why this error comes? Let’s see why it comes.

If you remember we have discussed in Lesson number 7 that every transaction in finacle will have two entries. Those two entries are 1. Credit entry 2. Debit entry.

When we do SB deposit transaction, customer’s SB account will be credited and Teller account will be debited. It means that when we accept deposits our teller cash position will increase but it will be in debit position. All these details we have clearly discussed in lesson no 7. Similarly while making withdrawal transactions customer SB account will be debited and teller cash position will be credited.

Here, the point to be noted is system will not allow SB withdrawal transaction if in teller cash position sufficient balance is not available in debit position.

Initially at the morning the teller cash position will be 0. Let us imagine that an RD deposit transaction is made for Rs.1000/-. Now the cash position will be 1000 in debit (Dr) position. See the image below.

As you can see after making the deposit Teller cash is debited by Rs.1000/-. So if we want to make any withdrawal transaction if the balance in Teller cash is less than the withdrawal amount system will show an error as “Cash Limit Error”.

Please note that to make any withdrawal transaction cash position must be in Dr Status only.

As a routine when we open the counter we take cash advance from Treasury. This advance transaction should also be done in the system. If you remember, while discussing about office accounts we have discussed about Vault account.

Vault is the equivalent of our Treasury. Small cash lockers are called CASH CHESTS. If the lockers are big like bigger than a house, then those lockers are called as VAULT.

So whatever advance we take from Treasury, the same advance transaction must be done in Finacle.

Let’s see how it done. We have to invoke HTM. Choose Function as ADD and Transaction Type/Sub type as C/CT – Cash/Cash Transfer and click on GO. See the image below.

After clicking on GO, the following screen. See the image now.

As you can see in the image, this screen is same as interest withdrawal screen. It will be same because we are using the same menu HTM.

Since we are taking advance from treasury we have to debit our teller id. Don’t get confused now. We have seen in the beginning of this lesson that while doing deposit transactions our teller account is getting debited. Similarly while taking advance from treasury we have to debit our teller account.

I hope you are getting my point.

So Choose part transaction type as Debit, enter your teller account Id and amount and then click on Add button. This is the first part transaction.

After clicking on the add button you will get the same screen again.

This is the second part transaction where we have to enter credit account details. Simple, just enter A/c id as vault account id {0406}, enter amount and choose part transaction type as Credit and click on post.

I hope you are getting my point. I really hope you have understood why we have debited the teller account id and credited the vault account.

Alternately in the second step after entering the account id, if you click the 3=3 button beside amount field, it will make all the necessary adjustments.

Cash Transfer to Vault.

Cash transfer to vault is very much similar to that of cash transfer from vault. In all these cash transfer transaction the only thing to keep in mind is which account getting debited and which account is getting credited.

If you know which account is getting debited and which account is getting credited it will be very easy for you to do these transactions.

In this case to transfer amount from Teller to Vault, we have to debit the vault account and credit the teller account.

We already know that when we do a withdrawal transaction in counter , customer’s account will get debited and teller account will get credited. Similarly to send cash to vault we have to credit the teller account and debit the vault account.

Now that we know which account to debit and which account to credit, follow the steps in above transactions and try this transaction too.

Cash Transfer between counters

Many offices have more than one counter in offices. There will be many such cases that counter PA will take cash from other counters instead of going to treasury. These cash transactions should also be done in the system. These transactions are also done in HTM menu only. All steps are same as we have done in the above two sections. Only thing is we have to identify which account should be debited and which account should be credited.

I’ll tell you a simple way to remember this without getting confused.

Simple, isn’t it? Now you know which account to debit and which account to credit. Follow the steps which we already discussed in this lesson and do the transactions.

Other uses of HTM menu

If you see in FUNCTION of HTM there are 5 options.

Now we know why we use Add and Verify options. Inquire is to do inquiry of transactions. Whatever be the transaction just choose function as Inquire and enter transaction ID and finacle will show the details of the transactions.

Modify is used to modify the State of the transaction from entered to posted state. It doesn’t mean you can modify the entire transaction details. NO! We cannot modify any details of any transaction once it is done.

Delete is used to delete the transactions. We already know that only entered state transactions can be deleted. So if you have mistakenly entered SB withdrawal as 66000 instead of 6600 you can delete that transaction using HTM and re do the transaction.

Any transaction can be verified using HTM menu. If you see any pending transactions in HFTI and you don’t know which menu to verify that transaction, simply use HTM menu to verify that transaction.

It is also possible to do multiple BO RD transactions as a single transaction using HTM menu but there should not be any default or rebate for those BO RD transactions. Debit account id will be {0339} and credit account ids will be RD account numbers. Note: We never tried this because we never worked in offices with BOs! So use this option at your own risk.

One last point before we conclude this lesson. People say that there is no option to view signature in HTM menu while doing interest withdrawal transactions. We enter sundry account number in A/c id field. Do you expect sundry account to have a signature? To view the signature of the MIS/TD/SCSS accounts first enter the actual MIS/TD/SCSS account number in A/c id field and press F9. System will then show you the signature. If you are convinced with the signature, then again do the normal withdrawal process. Hope you have got my point.

SO, that’s it for today’s lesson. Hope you have learned some new points in this lesson. See you again tomorrow same time same place.

Read more

1. Finacle Training Lesson 1 [Menus]
2. Finacle Training Lesson 2 [Login, Fincore]
3. Finacle Training Lesson 3 [On Screen Elements]
4. Finacle Training Lesson 4 [Function]
5. Finacle Training Lesson 5 [ Nomenclature , User Interface]
6. Finacle Training Lesson 6 [ 2 Steps, 4 States]
7. Finacle Training Lesson 7 [ Credits, Debits]
8. Finacle Training Lesson 8 [ Office Accounts]
9. Finacle Training Lesson 9 [Counter Transactions]
10. Finacle Training Lesson 10 [SB Withdrawal, RD Deposit ]
11. Finacle Training Lesson 11
12. Finacle Training Lesson 12 [The power of HTM]
13. Finacle Training Lesson 13 [HTM PART II]
14. Finacle Training Lesson 14 [ HTM PART III ]
15. Finacle Training Lesson 15 [ HTM Final Story ]

Source : poupdates.blogspot.com