CHAPTER -II REVIEW OF LITRATURE Social security is helping hand for old age person ,social security scheme

run by government is different for public sector employee and private sector employee in earlier days still at 2004 .at present scenario all public sector employee who joined after 2004 come under New Pension system umbrella. Some trade union are protest against new pension system which is implemented by central government the main reason for protest for old age pension .in earlier i.e. before 2004 public sector employee get three benefit at retirement provident fund ,gratuity and pension first two are lump sum amount which is provide at time of retirement and pension is given periodical basis at whole life and attach with P! inde"ation which is revised time to time by government i.e. in year twice .in private sector employee cover under employee pension scheme #$$% in &PS employee get ma"imum celling pension %000 per month but in 2004 government replace old pension scheme with NPS government said NPS is uniform pension system in !ndia which is common for all private sector and public sector employee .but still some organi'ation adopt employee provident fund scheme and employee pension scheme . (or my research ! read some literature ,journal and research paper for understand which scheme is benefit for employee point of view and employer point of view .

Ayanendu Sanyal & Charan Singh in their study on )*niversal Pension Scheme in !ndia )

they proposes a universal pension scheme that will bring relief to the wor+ing population in the unorgani'ed sector and argues that it will increase the coverage of pension without disturbing the fiscal situation. *niversal pension scheme would do this successfully for citi'ens in country. !n his paper they are also compare following social security scheme li+e ivil Service Schemes &mployee,s Provident (und -rgani'ation Schemes .&P(-/, -ccupational Pension Schemes, Public Provident (und, National -ld 0ge Pension Scheme, National Pension Scheme .in paper they forecast Pension estimates are made for 20#%, 202% and 20%0.

Pa ri!ia "u# in$ in their study on )Social Security in 1eveloping ountries2 3yth or Necessity4

&vidence from !ndia5 e"amined the case for the implementation of social protection policies in developing countries.specialy !ndia and his relates to the issue of who will benefit from social security programmes .6e also told the poorest individuals in !ndia are those belonging to minority religious and ethnic groups lower. castes .scheduled castes and tribes/, women, those living in remote locations, with limited access to productive assets and institutions and employed in insecure jobs. 6e illustrates the e"tent of income poverty in #4 major !ndian states in#$78974 and #$$$92000 :y the help of graph and chart shows that poverty has decreased consistently in !ndia between #$70 and #$$$.!n wor+ing paper also discuss regarding National Social 0ssistance Programme .NS0P/ encompasses a national policy for social assistance benefits to poor households in the case of old age, death of breadwinner and maternity !n his research paper e"amines the empirical effects of public e"penditure on social services on both the growth performance of the !ndia,s economy and the incomes of the poor. !n his results obtained in this paper show, however, that e"penditure on social services can have important endogenous effects on economic growth in !ndia, one of the poorest countries in the world.

A&ay Shah

in their study on )!ndian pension reform2 0 sustainable and scalable approach5 give point on why pension reform in !ndia in paper he also describe e"isting pension mechanism and their difficulties in ;raditional civil servants pension and employee provident fund, .&P(/ and the <employee pension scheme, .&PS/.in his paper he also relate present pension system and fiscal cost .!n paper discuss about New Pension System feasibility of implementation and its portability.

'

Su(hen )ali

!n their study on )&mpirical Study on =etirement :enefits of >overnment &mployees and Private Sector &mployees . overed by &P( ? 3P 0ct/ !n !ndia5 in his research mainly comparative study occupational retirement benefit plans of the >overnment employees and the employees of private sector .;he research is based on source of secondary data. ;he data are collected from the >overnment Service =ules, 1eath cum =etirement =ules .1 =:/, and National Pension Portals for the retirement benefits of the government employees and from the websites ? annual reports published by the &mployees, Provident (unds -rgani'ation and the 3inistry of @abour. ;he hypothesis of study is );here is no significant difference in the retirement benefits between the government employees .>roup 0 and >roup 1/ and Private Sector employees .employees covered under the &mployees, Provident (unds and 3iscellaneous Provisions 0ct, #$%2/5the result of study is say that there is a significant difference in the retirement benefits between the government employees and Private Sector employees of both >roup 0 and >roup 1. ta+ing the contribution of employer only to the &mployees Provident fund for Private Sector employees.

S+arn Cha er&ee !n their study on )=etirement Savings of Private and Public Sector &mployees2 0 omparative

Study5 e"amines the retirement plan participation and savings for *nited States government employees using the Panel Study of !ncome 1ynamics data set. ;he findings of this study indicate that plan participation increases with age, income and educational attainment. 3ore >overnment employees are enrolled in defined benefit plans than non9>overnment employees.in his study data ta+en from Panel Study of !ncome 1ynamics .PS!1/ ;he Panel Study of !ncome 1ynamics .PS!1/ is an ongoing nationally representative longitudinal study of appro"imately A,000 families living in the *nited States. &mployee participation in ta" sheltered accounts is the dependent variable for the first part of this study. 1escriptive statistical analysis is initially performed for e"amining the demographic composition, educational attainment, income, and investment characteristics of government and private sector employees. ;he second part of the study, investigates factors that determine the amount of saving in defined contribution plans and the amount of voluntary contributions that employees ma+e into their retirement plans. ;he findings reveal that although the government employees lag behind in defined contribution plan participation, the participating government employees hold greater wealth in these plans. 0lso, in order to better prepare employees for retirement, they must be encouraged to have greater ris+y asset ownership and !=0 participation.

This paper aims to present the findings of my research# on challenges facing the Bestern

:al+an countries, mainly 0lbania, Cosovo and 3acedonia .3acedonia/ in their pension reforms in response to the new political, economic, social and demographic realities. main hypothesis raised in my research is2 Bestern :al+an countries, which inherited very common pension systems, are reforming it using different approaches2 0lbania,s is based on the :ismarc+ian P0D> model, Cosovo,s is building a pro9mar+et, liberal model, and 3acedonia has created a mi"ed pension system, combining P0D> and the fully funded. !n my opinion, the best approach is to use the advantages of the different models to develop sustainable pension systems suitable for these :al+an countries.

Ed$g.anya/ Ade&$h

In # udy $n 0An A##e##1en $2 he I13a! $2 C$n ri.u $ry Pen#i$n S!he1e $ 4igerian E!$n$1i! 5e6el$31en 7 ;his research wor+ is focused on the assessment of the impact of ontributory Pension Scheme to Nigerian &conomic 1evelopment with relevance to Pension (und 3anager. ;he objective of this study was to e"amine how contributory pension scheme influence the >ross 1omestic Product .>1P/ in Nigeria. 3ore so, this study is aimed at suggesting the best reliable way for tac+ling or handling the fear that the funds or =etiree Savings 0ccount .=S0/ contribution can be mismanaged by the e"isting trustees. ;he main problem of the study was centered on the nature and effect of ris+ prevailing in the pension assets management. =esearcher designed the study using survey design and sample si'e was ta+en as 80 and 70 for both staff and customers respectively. 1ata were collected from both primary and secondary sources and analy'ed using percentage. ;he researcher adopted correlation analysis for testing secondary data and 0N-E0 for the primary data. ;he result of correlation analysis using t9test revealed that ontributory Pension Scheme . PS/ has significant impact on the >1P while the result of 0N-E0 revealed that ris+ prevalent has positive effect on the pension fund management. ;he researcher therefore, recommends that the Pension (und 0dministrators should invest in less ris+y portfolio to enhance prompt payment of pension to retirees.
8

Ar&una )ana(ara na1 and 9a Ping 9in

They S udy $n re2$r1ing he Sri Lan(an E13l$yee# Pr$6iden Fund : 0 6istorical and ounterfactual Simulation Perspective ;he focus of this paper is on the mandatory funded retirement income support system in Sri @an+a, which is largely provided by the &mployee Provident (und .&P(/. Paper first of all see+s to reveal the deficiencies in the Sri @an+an &P( system from both a micro and a macro perspective. objective of the paper is to use the >& model to evaluate various options for reforming the &P( through counterfactual simulation methods. paper e"amines the implications of introducing reform scenarios for the design of the counterfactual simulations and evaluates the effects of the reform strategies on macroeconomic performance and income replacement ratios. onclusion and result of paper suggested that Sri @an+a,s largest provider of mandatory retirement savings that is the &P( has incurred e"cessive

financial liabilities. &P( engaging in Fuestionable investment decisions whereby it has served as a cheap source of public credit by investing in government securities.

Si1$ne S el en Her ie )E< ending C$6erage $2 he 4e+ Pen#i$n S!he1e in India Analy#i# hapter !!

$2 =ar(e F$r!e# and P$li!y O3 i$n#7 The paper is divided into five chapters.

provides a theoretical and analytical basis for the empirical analysis in three steps. (irst, it develops a theoretical framewor+ for the study by defining indicators for the analysis of supply and demand as well as criteria for the successful implementation of voluntary 1 pension schemes in @1 . Second, it summari'es the development of the public pension system in !ndia. 0nd third, it provides a statistical picture of the policy problem. hapter !!! constitutes the main part of the empirical analysis and investigates the mar+et forces of NPS and in how far both sides match. ;he demand analysis provides a clearer picture of the relevant mar+et segment in terms of gender, age, occupations, residential area, education, financial literacy, saving patterns, and the level of trust towards the private sector. !n order to assess the supply of the NPS, the approach will be described in terms of its institutional architecture, enrollment processes, investment options, and mar+eting approaches. ;he chapter concludes with the answer to the first research Fuestion on reasons for low NPS coverage. hapter !E answers the second research Fuestion on ways to increase NPS coverage. (inally, Fuestions for further research.
1>

hapter E concludes with a set of concrete policy

recommendations, a medium9term outloo+ on the potential development of the NPS scheme, and

5r? R$.in#$n Onu$ra Ug+$(e And 5r? @=r#?A Edi h Og$eg.una1 Onyeanu

# udy $n 05e er1ina i$n $2 he Le6el $2 A!!e3 an!e and C$13lian!e $ he 4e+ Pen#i$n S!he1e in 4igeria7 ;his paper reviews the new pension scheme in Nigeria vi' a vi' the basic philosophy and objectives of pension schemes generally. !t chronicles the various efforts and challenges at administering an effective pension scheme in Nigeria over the years with particular focus on the level of acceptance and compliance by all the sta+e holders in the new scheme. ;he main objective of this research wor+ was an evaluation of pension fund administration in Nigeria, Primary and secondary data were collected and analy'ed using chi sFuare and t9test to arrive at dependable conclusion and policy recommendations. ;his research wor+ revealed that

pension scheme is something that cannot be treated with levity. (or effective and efficient pension fund administration in Nigeria, they following policy recommendations are ;he Nigerian government should encourage the option of having the ban+s where the salary accounts of employees are domiciled to ma+e the pension deductions on monthly basis and have it remitted to the concerned pension fund administrators .P(0/ i.e. employers should stop deducting the pension contribution at source. ;he review of this role is necessary because, it seems the number of defaulting firms is on the increase. ;he regulator .National Pension ommission/ should enforce the relevant sanctions of the Pension =eform 0cts on defaulting employers to improve on the e"isting compliance.

11

"ai+ardhan Vi& # udy $n Li2e!y!le FundB A 5e2aul O3 i$n 2$r 4e+ Pen#i$n Sy# e1 .;his

paper is organi'ed as follows. Section 2 provides a brief discussion of the lifecycle fund, outlines the ris+s while investing in lifecycle fund and some e"amples. Section 8 describes the costs involved in lifecycle funds. Section 4 analy'es the lifecycle funding approach in the ambit of NPS. onclusion of paper is given the increasing demand of simple investment solutionsG a lifecycle fund is an appropriate investment for most of the investors. ;wo +ind of lifecycle funds have been discussed in this paper. ;he investors who opt for target lifecycle funds typically are either the investors who are loo+ing for a simple solutions that reFuires nothing of them or relatively +nowledgeable investors who lac+ the time or desire to monitor their investments but want the benefit of professional management.

12

Ranade6 C$#+a1i # udy $n 0Indian Pen#i$n Sy# e1B Pr$.le1# and Pr$gn$#i#7 ;his

paper reviews the current state of the !ndian pension system. ;he !ndian e"perience could potentially influence policy decisions in other developing countries, especially those with similar reliance on the national provident fund system. ;he paper concludes with some policy directions for reforming the !ndian pension system. Section 2 reviews the structure of the current pension system. !n section 8, the motivations for reforming the current system are discussed. ;he recent institutional developments pertaining to the pension sector is described in section 4. Ne"t, in section %, the study assesses the major issues that need to be addressed for a comprehensive reform of the !ndian pension system. Section H provides concluding comments including a

summary of the discussion.

onclusion and result !ndian pension system is passing through a

crisis of confidence. ;he economic, demographic and labor mar+et trends of the current system are moving in troublesome directions. ;he problems that the system is confronting now are Fuite well +nown2 li+e 1emographic aging, changing social mores, S+ewed coverage, !neFuity in benefits, and Pressure on public finances.

1%

5r? H? Sadha( study on !mpact -f Pension =eforms -n Savings !nvestment 0nd >rowth in hile, Peru, olombia, 3e"ico, 0rgentina, *ruguay and :olivia he also mention in his paper Second

his paper they discuss about pension reform in different @atin 0merican ountries

>eneration Pension =eforms2 3ain (eatures of the New 3odels then after he also write about pension system in !ndia .in conclusion (acts and figures provided from cross section e"perience indicate that Pension =eforms in @atin 0merican ountries particularly that of hile did not have much growth and savings effect whereas they have provided boost to capital mar+et development but at a high costs offsetting the gains of capital mar+et development. -n the other hand countries li+e Sweden, Singapore and 3alaysia with alternative arrangements and Pension System have registered better growth in >1P, Saving and attention.
1'

apital 3ar+ets, which deserve our

Pa.l$ An $lin/

overage of (unded Pension Plans , ;his paper presents comparable and

standardised data on coverage in voluntary funded pension plans for several -& 1 countries using household survey data by age, income level, and labour mar+et status for occupational and personal pension plans. ;he analysis suggests that coverage is unevenly distributed across individuals and there is therefore a need to increase it, at least among the young and the mid9to9 low income. ;he paper ends assessing different policies to increase coverage. ;his paper focuses only on income from funded pension plans, an important component of wealth at retirement, but it does not address other major sources of retirement wealth such as housing.

*niversal Pension Scheme in !ndia, Bor+ing Paper No2 420, !ndian !nstitute of 3anagement Social Security in 1eveloping ountries2 3yth or Necessity4 &vidence from !ndia, Prus Poverty

:angalore, 0ugust 20#8

2

=esearch *nit at Susse" Bor+ing Paper No. 20, September 2008

8

0jay Shah, !ndian pension reform2 0 sustainable and scalable 0pproach, 3inistry of (inance,

New 1elhi, 1ecember %, 200%

4

Su+hen Cali, )&mpirical Study on =etirement :enefits of >overnment &mployees and Private

Sector &mployees . overed :y &P( ? 3P 0ct/ !n !ndia5 >lobal =esearch 0nalysis Eolume2 # I !ssue2 % I Nov 20#2 J !SSN No 2277 K A#H0 PP %29%4
%

Swarn hatterjee )=etirement Savings -f Private 0nd Public Sector &mployees2 0 omparative Study5, ;he Lournal of 0pplied :usiness =esearch K NovemberM1ecember 20#0 ,

Eolume 2H, Number H ,PP $%9#02

7

&dogbanya, 0dejoh study on )0n 0ssessment of the !mpact of ontributory Pension Scheme to

Nigerian &conomic 1evelopment5 >lobal Lournal of 3anagement and :usiness =esearch Eolume #8 !ssue 2 Eersion #.0 Dear 20#8
A

0rjuna Cana+aratnam and Da Ping Din study on reforming the Sri @an+an &mployees Provident onference on Policy 3odelling 9 &co3od2004 9

(und paper presented on !nternational

*niversity of Paris ! 9 PathNon9Sorbonne, Paris, Lune 80 to Luly 2.

$

Simone Stelten 6ertie )&"tending

overage of the New Pension Scheme in !ndia 0nalysis of

3ar+et (orces and Policy -ptions5 6ertie School of >overnance 9 Bor+ing Papers, No. H2, 0ugust 20##

#0

1r. =obinson -nuora *gwo+e and 1r. .3rs./ &dith -goegbunam -nyeanu study on ompliance to the New Pension Scheme in

)1etermination of the @evel of 0cceptance and .-nline/ Eol.4, No.#, 20#8.

##

Nigeria5 =esearch Lournal of (inance and 0ccounting !SSN 22229#H$7 .Paper/ !SSN 222292A47

Laiwardhan Eij study on @ifecycle (und2 0 1efault -ption for New Pension System, Britten

for and presented at 7th > 0, New 1elhi #%9#H, (ebruary, 200%.
#2

=anadev >oswami (ellow, !ndian !nstitute of 3anagement :angalore study on )!ndian

Pension System2 Problems and Prognosis5

1%

5r? H? Sadha(, !mpact -f Pension =eforms -n Savings !nvestment 0nd >rowth Paper

presented at the !naugural >lobal Symposium on Pensions held at the National !nsurance 0cademy, Pune.
1'

An $lin/ P? .200A/, O overage of (unded Pension PlansO,-& 1 Bor+ing Papers on !nsurance

and Private Pensions, No. #$, -& 1 publishing, P -& 1. doi2#0.#7A7M24##42#%H207