What is Old Pension Scheme? All you need to know

Old Pension Scheme: Several states are opting back to the Old Pension Scheme. States like Rajasthan, Chhattisgarh, Jharkhand, Punjab and Himachal Pradesh have already rolled out the Old Pension Scheme and discontinued the National Pension System (NPS).

What is Old Pension Scheme

• Under the Old Pension Scheme, the entire pension amount to a government employee is paid by the government after retirement. The pension amount is not deducted from the salary of the employee during the period of employment.
• However, the Old Pension Scheme was discontinued by the NDA government in 2004. Then Atal Bihari Vajpayee government had introduced the National Pension System.
• Under the Old Pension Scheme, a retired government employee used to get the benefit of the revision of Dearness Relief (DR), twice a year. 
• Under the Old Pension Scheme, approximately 50 per cent of the last drawn salary was provided as pension.
• As per the rule, only government employees were eligible for receiving a pension under the Old Pension Scheme after retirement.
• Under the OPS there was the provision of the General Provident Fund (GPF). GPF is available only for all government employees in India. Basically, it allows all government employees to contribute a certain percentage of their salary to the GPF.