The Department of Expenditure (DoE), Ministry of Finance, has reminded government departments not to delay the remittance of employees’ NPS contributions to Pension Fund Regulatory and Development Authority (PFRDA) as it is affecting employees’ NPS corpus.
The DoE in an office memorandum (OM) dated July 13, 2026, asked the government departments to follow strict guidelines in remittance of NPS contributions, pay interest to employees in case of delay and ensure the accountability of officials responsible for such a delay.
The DoE has reiterated that if the monthly NPS contribution is credited after the prescribed deadline, the employee should also get interest for the delayed timeframe.
Also Read: Can banks increase FD interest rates as inflation crosses RBI’s target of 4%?
The OM says that in such cases, the interest will be the same as the Public Provident Fund (PPF) interest rate applicable from time to time. The current PPF interest rate is 7.1%.
The DoE has also said that if the delay was because of an administrative lapse, the Head of Department or Chief Controller of Accounts should identify the responsible officials. In such cases, as per the OM, the delinquent official should be liable to pay the interest amount of pecuniary lapse to the government.
The ministry has said that a report of detailed actions taken in this regard till date can be provided by July 31, 2026.
What did the DoE say about delay in NPS contributions in its OM?
The DoE OM reads: “Every case of delay in the commencement of contributions or deduction or crediting of monthly contribution by the government in the individual pension account of the subscriber shall be examined by the Head of Department or Chief Controller of Accounts for the fixation of responsibility.”
Penalty on officials
As per the OM, if the head of department or chief controller of accounts is satisfied that the delay in NPS contribution is caused on account of administrative lapse, the delinquent official(s) will be liable to pay the amount of pecuniary loss to the government on account of the payment of interest.
Quantum of punishment for officials
The office memorandum underlines that the responsibility and the amount of liability on part of the delinquent official(s) should be determined in the same manner as in the case of delayed deduction or remittance of tax deduction at source (TDS) under Section 201(1A) of the Income-tax Act, 1961.
The OM stresses this will be without prejudice to any disciplinary action which the disciplinary authority may propose to take against the official(s) responsible for the administrative lapse in this respect.
Strict compliance requirements
The OM says that all the offices are advised to strictly adhere to the prescribed timelines for the remittance of NPS subscription. Concerned head of the departments are also advised to ensure strict compliance of the provisions and take appropriate actions.
