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Phase out PPF, says pension regulator

August 27, 2005 14:34 IST
Public Provident Fund should be phased out over a period of time after the introduction of the new pension scheme proposed by the government, the interim Pension Fund Regulatory and Development Authority chairman D Swarup said on Saturday.

''Already a committee headed by Rakesh Mohan, of which I am a member, has recommended to phase out PPF after the new pension scheme,'' Swarup said at the sidelines of a Bengal Chamber of Commerce and Industry seminar on pension reforms in Kolkata.

PPF scheme offers a high administered return to the investors and anybody can invest in it.

Any pension scheme, which is not covered under any statute of the country, will come under purview of PFRDA, Swarup said.

Swarup also intends to ban pension-based mutual funds to invest in foreign securities as, under the current proposed investment schemes of pension funds, there was no provision to invest aboard.

There are currently three schemes, safe, balanced and growth where investment of equity is regulated. In safe fund, investment in equity can be upto 10 per cent.

The PFRDA will announce a fourth plan in which 100 per cent of the fund would be invested in government guaranteed papers after standing committee on finance had recommended the new investment plan.

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