Government Notifies Employees’ Pension Scheme, 2026

The Government has notified the Employees’ Pension Scheme, 2026, under the Code on Social Security, 2020. The new Scheme supersedes the earlier Employees’ Family Pension Scheme, 1971 and the Employees’ Pension Scheme, 1995.

The Scheme provides a consolidated framework for pension membership, contributions, pensionable service, pensionable wages, the administration of the Pension Fund, and the payment of pensions and other benefits.

1. Supersession of Earlier Pension Schemes

The Employees’ Pension Scheme, 2026 replaces:

• Employees’ Family Pension Scheme, 1971; and
• Employees’ Pension Scheme, 1995.

This forms part of the implementation of the Code on Social Security, 2020, which seeks to consolidate and update social security laws relating to employees.

2. Membership Under the Scheme

The Scheme lays down provisions relating to membership of the Employees’ Pension Scheme.

It provides the framework for identifying eligible members and regulating their participation in the pension scheme.

3. Pension Fund Account

The Scheme provides for the maintenance and administration of the Pension Fund Account.

This account will be used to receive contributions and make pension-related payments in accordance with the provisions of the Scheme.

4. Payment of Contributions

The Scheme contains provisions relating to the payment of contributions towards the Pension Fund.

Employers and other applicable contributors will be required to make contributions in the manner and within the timelines prescribed under the Scheme.

5. Recovery of Damages for Default

The Scheme provides for the recovery of damages in the event of default in the payment of contributions.

This provision is intended to ensure timely compliance and protect the financial stability of the Pension Fund.

6. Resolution of Doubts

The Scheme also contains provisions for the resolution of doubts arising from its implementation.

This will help address interpretational or operational issues relating to membership, contribution, pensionable service and benefits.

7. Determination of Eligible Service

The Scheme provides for the determination of the eligible service of members.

Eligible service is relevant for deciding entitlement to pension and other benefits under the Scheme.

8. Determination of Pensionable Service

The Scheme also lays down the method for determining pensionable service.

Pensionable service is an important factor in calculating pension entitlement and assessing the period for which a member qualifies for benefits.

9. Determination of Pensionable Wages

The Scheme provides for the determination of pensionable wages for the purpose of calculating pension benefits.

This ensures a structured basis for computing the pension payable to eligible members.

10. Payment of Pension and Other Benefits

The Scheme contains provisions relating to the payment of pension and other benefits to eligible members or beneficiaries.

These provisions will govern the manner, eligibility and conditions for receiving pension benefits under the Scheme.

11. Effective Date

The Employees’ Pension Scheme, 2026 shall come into force on the date of its publication in the Official Gazette.

12. Objective of the Scheme

The Scheme seeks to:

• Replace and update the earlier pension schemes;
• Align pension provisions with the Code on Social Security, 2020;
• Consolidate rules relating to pension membership and contributions;
• Provide clarity on eligible service, pensionable service and pensionable wages;
• Ensure proper administration of the Pension Fund; and
• Regulate the payment of pension and other benefits.

13. Key Takeaway

The Government has notified the Employees’ Pension Scheme, 2026 under the Code on Social Security, 2020, superseding the Employees’ Family Pension Scheme, 1971 and the Employees’ Pension Scheme, 1995. The Scheme covers membership, Pension Fund Account, contribution payment, recovery of damages for default, determination of eligible service, pensionable service and pensionable wages, and payment of pension and other benefits.