Managing Funds of NPS
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF FINANCIAL SERVICES
UNSTARRED QUESTION NO. 1486
TO BE ANSWERED ON 20 DECEMBER, 2022 (TUESDAY)/ AGRAHAYANA 29, 1944 (SAKA)
PENSION FUND UNDER THE NEW PENSION SYSTEM (NPS)
- Shri Deepender Singh Hooda:
Will the Minister of Finance be pleased to state:
(a) How much corpus fund has been generated and which agency has been entrusted with managing the funds under the New Pension System (NPS);
(b) Whether it is a fact that the Pension Fund Managers are allowed to invest in Alternative Investment Funds (AIFs) which also includes Startups;
(c) If so, the complete details including measures taken to safeguard the Pension Fund;
(d) What is the annual earning to Government by way of managing this Fund; and
(e) Whether the earnings are also shared with the State Governments?
THE MINISTER OF STATE IN THE MINISTRY OF FINANCE
(DR. BHAGWAT KARAD)
(a) As on 30.11.2022, the total Asset Under Management (AUM) under National Pension System (NPS) including in respect of Atal Pension Yojana (APY) is Rs. 8,43,640.54 Crores. As on date, 10 Pension Funds are registered with Pension Fund Regulatory and Development Authority (PFRDA) for managing the funds under NPS. The names of the Pension Funds are as under:
- SBI Pension Funds Private Limited
- LIC Pension Fund Limited
- UTI Retirement Solutions Limited
- HDFC Pension Management Company Limited
- ICICI Prudential Pension Fund Management Company Limited
- Kotak Mahindra Pension Fund Limited
- Aditya Birla Sun Life Pension Management Limited
- Tata Pension Management Limited
- Max Life Pension Fund Management Limited
- Axis Pension Fund Management Limited
(b) and (c) Investment guidelines issued by the Pension Fund Regulatory and Development Authority (PFRDA) for NPS Schemes (Other than Government Sector, Corporate CG, NPS Lite and APY) allow investment in Securities and Exchange Board of India (SEBI) regulated Alternative Investment Funds (AIFs) as defined under the SEBI (Alternative Investment Fund) Regulations, 2012. The permitted investments include Start-up Funds among other permitted alternative investments. As per the Investment Guidelines issued by PFRDA, the following measures are taken to safeguard the Pension Funds:
i. The Pension Fund shall invest only in those AIFs whose corpus is equal to or more than Rs. 100 crores.
ii. The exposure to single AIF shall not exceed 10% of the AIF size.
iii. Pension Funds to ensure that funds should not be invested in securities of the companies or funds incorporated and operated outside India in violation of Section 25 of the PFRDA Act, 2013.
iv. The sponsors of the AIFs should not be the promoter in Pension Fund or the promoter group of the Pension Fund.
v. The AIFs shall not be managed by Investment manager, who is directly or indirectly controlled or managed by Pension Fund or the promoter group of the Pension Fund.
(d) and (e) Earnings from the fund managed under NPS, after deducting applicable charges, are accumulated in the NPS accounts of subscribers. Since inception, the weighted average returns under the default scheme of NPS for Central Government and State Government subscribers, are as under:
|Schemes||Weighted Average Returns since inception (%) as on 09.12.2022|
|Central Government (CG)||9.48%|
|State Government (SG)||9.33%|