Retiree demographics show that between 2017 and 2025, the force of retirees aged 80 and over grew 1.7 times – from 41,489 to 1,13,380. | Photo credit: Getty Images
AIADMK General Secretary Edappadi K. Palaniswami’s refusal to commit to restoring the old Pension Scheme (OPS) for government employees and teachers reflects his realization that it is unsustainable in the long term.
While interacting with reporters in Salem on Pongal day (January 15), Mr. Palaniswami was asked if he would return to OPS in case of his party’s victory in the assembly elections. His response was that a decision would be taken “depending on the situation”. He added that his party would make “only those promises that are feasible”. He also criticized the ruling DMK for not living up to its 2021 election promise of OPS.
A few weeks ago, Chief Minister MK Stalin announced that his government would introduce the Tamil Nadu Assured Pension Scheme (TAPS), a combination of OPS, the Union government’s Unified Pension Scheme (UPS) and the Andhra Pradesh Guaranteed Pension Scheme (APGPS). TAPS, providing for the payment of a monthly pension, has retained the contribution element that is contained in the Contributory Pension Scheme (CPS) or the National Pension Scheme (NPS). About 10 days ago, the Tamil Nadu government issued an order that the new scheme came into effect on January 1.
In the last five years or so, there has been a trend among some states to return to OPS. States like Rajasthan, Jharkhand and Chhattisgarh have announced their return to OPS. However, the Reserve Bank of India and several economists have warned state governments in general against returning to the old scheme, arguing that the move would result in a build-up of unfunded liabilities in the coming years.
Moreover, as the Tamil Nadu government’s White Paper presented in August 2021 points out, the government has resorted to borrowing in the past even for non-discretionary expenditure items, which included the payment of pensions, one of the significant components of liabilities.
With the increasing average life expectancy, the number of pensioners and family pensioners in the state has been stabilizing at around seven thousand for some time. Pensioner demographics show that between 2017 and 2025 the number of pensioners aged 80 and over grew 1.7 times – from 41,489 to 1,13,380. Not surprisingly, year-on-year growth in pensions and other pension benefits was generally in double digits.
Published – 17 Jan 2026 0:21 IST