History
In 1999, the Union of India had commissioned a national project titled "OASIS" (an acronym for old age social & income security) to examine policy related to old age income security in India. Based on the recommendations of the OASIS report, the Union of India introduced a new Defined Contribution Pension System for the new entrants to Central / State Government service, except to Armed Forces, replacing the existing system of Defined Benefit Pension System.
On 23-August-2003, the Interim Pension Fund Regulatory & Development Authority (IPFRDA) was established through a resolution by the Union of India to promote, develop and regulate the pension sector in India. The contributory pension system was notified by the Union of India on 22-December-2003 to the National Pension System (NPS) with effect from 01-January-2004. The NPS was subsequently extended to all citizens of the country with effect from 01-May-2009 including self employed professionals and others in the unorganised sector on a voluntary basis.
The Pension Fund Regulatory & Development Authority Act was passed on 19-September-2013 and the same was notified on 01-February-2014. PFRDA regulates the NPS, subscribed by employees of Union of India, States / UTs and by employees of private institutions / organisations & unorganised sectors. The PFRDA ensures the orderly growth and development of pension market.
PFRDA have set up a Trust under the Indian Trusts Act, 1882 to oversee the functions of the Pension Fund Managers (PFMs). The NPS Trust is composed of members representing diverse fields and brings wide range of talent to the regulatory framework. The Union Parliament of India passed the IPFRDA - Interim Pension Fund Regulatory & Development Authority Bill in February-2003 as a Budget Announcement, approved by the then President of India, Dr. APJ Abdul Kalam. It was meant to be in place until the final and fool-proof system was prepared, re-approved, and implemented in a way acceptable to all political parties in India, including the opposition. Tamil Nadu became the first state to implement NPS for its newly appointed employees from the financial year 2003–04, under the Chief Ministership of Jayalalithaa.
On 19-September-2013, the President, Mr. Pranab Mukherjee, gave his assent to Pension Fund Regulatory and Development Authority Bill of 2013, which was passed in the Monsoon Session of Parliament on 04-September-2013 in the House of the People and 06-September-2013 in the Council of States, to make it a Permanent Act. This improved, foolproof and re-approved Bill, with the acceptance of all political parties in India, has replaced the old and imperfect IPRDA Bill of 2003. The President of India is the guardian of the PFRDA, subject to his Financial Emergency Powers, as per the Articles of Indian Constitution. PFRDA now has Full Autonomy & functioning Independently from F.Y. 2014–15.
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