PFRDA notifies simplified rules for Pension Funds, NPS Trust

New Amendments Introduced by PFRDA to Improve National Pension System Trust

The Pension Fund Regulatory and Development Authority (PFRDA) has recently announced amendments to the regulations of the National Pension System Trust and the Pension Fund to reduce compliance costs and enhance ease of doing business. The amendments aim to simplify provisions related to governance and compliance, in line with the Companies Act, 2013.

According to the official statement issued on Wednesday, the National Pension System Trust (Second Amendment) Regulations 2023 and Pension Fund (Amendment) Regulations 2023 were notified on February 5 and February 9, respectively. The amendments to NPS Trust Regulations simplify provisions related to the appointment of Trustees, their terms and conditions, holding of meetings of Board of Trustees, and the appointment of CEO – NPS Trust.

Similarly, the amendments to Pension Fund Regulations simplify provisions related to the governance of Pension Funds and enhance disclosure by Pension Funds. They also provide clarity on the roles of Sponsor of Pension Fund and Pension Fund, along with compliance to ‘fit and proper person’ criteria.

Other key amendments include the requirement for existing pension fund(s) to comply with a provision within a period of 12 months, such as the inclusion of the name ‘Pension Fund’ in the name clause and the constitution of additional Board committees by Pension Funds, such as the Audit Committee and Nomination & Remuneration Committee. The annual report of schemes managed by the pension fund will now include a Directors’ responsibility statement.

The detailed information on the amended regulations is available on the PFRDA website. The PFRDA has provided the links to access the information on NPS Trust and Pension Fund amendments.

This move is expected to streamline the functioning of the National Pension System Trust and the Pension Fund, making it more efficient and easier to do business with. It will also provide greater clarity and transparency in the operations of Pension Funds, ultimately benefiting the subscribers of the National Pension System.