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Pension norms under attack
By Vinu Lal
Times of India, May 21, 2003
- Private players are not very happy with the government’s steep norms
for entering the liberalised pension market. And, for the Rs 300,000-crore
plus pension market, the reforms agenda is poised to be turbulent.
as the finance ministry issued a directive two weeks back on pension
reforms, a nation-wide campaign against the skewed entry norms for private
participation is building up.
Sinha, joint secretary of finance, recently issued a directive, indicating
the ways of introducing pension reforms, based on the Old Age Social and
Income Security (Oasis) report.
crux of the issue is the government’s move to restrict private players
to six and the entry norms governing these players. In the new system,
there would be separate AMCs which would manage the funds of the pension
it is not clear whether the role of the pension fund would be limited to
mobilise funds and the responsibility of its management would be
segregated to other players.
government argues that this would bring in more transparency. But the
market players feel otherwise.
participation should be allowed in the lines of an open market policy,
while the government should specify the maximum costs permissible for
floating pension plans. The current proposal of bidding is skewed, as it
does not cover aspects like credibility of the sponsor, track
record,’’ said AP Kurian, chairman, Association of Mutual Funds of