January 09, 2007	Tuesday	Zilhaj 18, 1427

ISLAMABAD, Jan 8: To introduce a robust and flexible pension system in the country, the Securities and Exchange Commission of Pakistan (SECP) has launched the Voluntary Pension System (VPS) by issuing certificates of registration to four asset management companies to act as pension fund managers.

The SECP developed the legal framework for private pensions in the country through notification of the VPS Rules, 2005. International best practices were followed and reforms in the neighbouring countries were taken into account while developing these rules.

Under the VPS, all Pakistani nationals over the age of 18 years (salaried or self-employed), who have a valid National Tax Number (NTN) are eligible to participate in the forthcoming pension scheme.

“The VPS is based on several tax incentives, which make it attractive to the participants,” the commission observed.

Under the new system those individuals, who are not covered under any pension scheme, would also be able to save for their old/retirement age by making tax-free contribution to the pension fund.