Cabinet approves new Contributory Pension Fund

Cabinet has decided to establish a fund named "National Contributory Pension Fund" for all new recruits to the government service as well as those who have been recruited to the government service after January, 2016. 

Accordingly, 8% from the basic salary of the employee and 12% from the employer should be credited to the proposed fund when a state employee is recruited to the state service.

An independent entity governed by a board of management to manage the proposed contributory pension fund will be established and a fund manager with special skills will be appointed for management of the funds, the government stated.

The proposed national contributory pension scheme will be applicable to the individuals newly recruited to the government service. Whereas, those recruited to government service after the month of January 2016 can contribute to the proposed national contributory pension scheme as per their consent.

The new contributory pension fund is being established to ensure an appropriate environment for government employees to to spend their retirement without being a burden to the country as well as to provide a pension with a certain profit for the retired life of the state sector pensioners.

Cabinet yesterday approved the proposal submitted by the President to direct the Legal Draftsman to prepare a draft bill so that required provisions can be made available.