Syllabus: GS-III & V – Fiscal Policy

Why in the news?

Growing resentment among Assam’s government employees under the New Pension Scheme (NPS) and rising support for the Old Pension Scheme (OPS) have revived statewide debates, protests, and political pressure. The recent approval of the Unified Pension Scheme (UPS) at the national level has further intensified discussions on OPS restoration in Assam.

The Debate on Restoring OPS in Assam

• Understanding the Employee Concerns

For lakhs of government employees, pension is more than a monetary benefit — it reflects dignity, security, and social stability after retirement. Under NPS, pensions depend on volatile market returns, creating financial uncertainty. This has triggered strong dissatisfaction and mobilised a large movement across Assam.

Assam Government’s Position vs Ground Reality

• The Assam Government maintains that reintroducing OPS would create a heavy financial burden on the state budget.
• The Chief Minister has repeatedly stated that OPS is “not rational” as it requires government-funded pensions with no employee contribution.
• In reality, six Indian states—Rajasthan, Chhattisgarh, Punjab, Jharkhand, Himachal Pradesh, and West Bengal—are successfully operating OPS without experiencing financial instability.
• OPS provides predictable, stable expenditure patterns, whereas NPS exposes employees to market volatility and risk.
• Assam receives significant fiscal support from the Centre, making OPS more feasible than the government presently claims.

Growing Momentum of the OPS Movement in 2025

• The movement strengthened through organised protests, including Black Badge campaigns, Dispur marches, Assembly blockades, teachers’ rallies, and strikes.
• By late 2025, multiple organisations publicly rejected the Unified Pension Scheme (UPS) as an inadequate alternative.
• The strategy ahead includes forming an Assam OPS Sangram Samiti, conducting constituency-level discussions with MLAs, launching awareness campaigns across rural and urban areas, and preparing a PIL in the Supreme Court.
• If employees and teachers intensify coordinated strikes during the 2026 pre-election period, pressure on the government may become decisive.

Lessons for Assam from States that Restored OPS

• Five states—Rajasthan, Chhattisgarh, Punjab, Jharkhand, and Himachal Pradesh—have already restored OPS, while West Bengal continues with OPS since it never adopted NPS.
• These states demonstrate that OPS is financially manageable when political will and administrative clarity exist.
• Their experience suggests that OPS strengthens employee morale and contributes to administrative stability.
  

Financial Feasibility of OPS in Assam

• Assam’s annual pension bill for 2025–26 is estimated at around ₹9,000 crore.
• Restoring OPS could require an additional ₹2,500 crore annually for the first few years.
• However, Assam receives nearly ₹18,500 crore from the Centre under SASCI, which significantly offsets pension expenditure.
• The net financial burden would be approximately ₹800 crore per year, amounting to less than 0.5% of the state budget.

Therefore, claims that OPS would “collapse” Assam’s finances are not supported by facts.

Teachers as the Strongest Pillar of the Movement

• Assam has around 3.5 lakh employees under NPS, of which 1.22 lakh are teachers—the largest organised workforce in the state.
• Teachers’ strong social presence across districts makes them the most influential group in mobilising public opinion.
• If teachers unify under a common platform, they could significantly accelerate the push for OPS restoration.
  

Key Differences Between UPS, NPS, and OPS

• Old Pension Scheme (OPS) ensures a guaranteed pension equal to 50% of the last drawn salary, along with dearness allowance adjustments and no market risk.
• New Pension Scheme (NPS) is market-dependent, has no assured pension, and lacks dearness allowance benefits.
• Unified Pension Scheme (UPS) requires a 10% employee contribution, provides a 50% assured pension only after 25 years of service, and retains market-linked features.
• UPS does not compensate for the long-term losses suffered by mid-career NPS employees, making OPS restoration the more favourable solution.
  

Roadmap for 2025–26

• The roadmap includes forming a unified OPS movement body in December 2025.
• Statewide awareness campaigns are planned for January 2026 to educate employees and the public.
• MLA-level dialogues will be initiated in February to ensure political accountability.
• A PIL is likely to be filed in the Supreme Court to question NPS’s design and demand OPS restoration.
• If demands are not met, an indefinite statewide strike may occur before the 2026 elections.
  

Conclusion

• Restoring OPS in Assam is financially feasible, socially necessary, and politically likely if employees unite strongly.
• OPS ensures long-term financial dignity, administrative morale, and public trust in governance.
• If 3.5 lakh employees and 1.22 lakh teachers unite, the restoration of OPS becomes highly achievable in the near future.
  

Exam Hook – Mains Question 

Evaluate the financial, administrative, and socio-political implications of restoring the Old Pension Scheme (OPS) in states like Assam.

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