New Pension Bill passed in Parliament

7 Sep

After a delay of nearly a decade, Parliament on Friday passed a key economic reforms legislation, the Pension Bill, that aims to create a regulator for the sector and allows at least 26 percent FDI.

The Pension Fund Regulatory and Development Authority (PFRDA) Bill, 2011, was passed in the Rajya Sabha with 115 MPs voting in favour and 25 against including members form Left parties and TMC.

The bill was passed in the Lok Sabha on 4th September. The bill would make the Pension Fund Regulatory and Development Authority a statutory authority, unlike its present non-statutory status.

The bill provides subscribers a wide choice to invest their funds including for assured returns by opting for Government Bonds as well as in other funds depending on their capacity to take risk, a provision that came from opponents of the legislation.

It pegs the FDI in pension sector at 26 percent or such percentage as may be approved for the insurance sector, which ever is higher.

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