New Delhi, Sep 6 (IANS): The Rajya Sabha Friday cleared the much-awaited pension bill that paves the way for individuals to widen their post-retirement cover and allows foreign investors to acquire up to 26 percent stake in the sector.

The Lok Sabha passed the Pension Fund Regulatory and Development Authority Bill (PFRDA), 2011, Wednesday.

The bill, once signed by President Pranab Mukherjee, will provide statutory authority to pension regulator, the Pension Fund Regulatory and Development Authority. At present, it has non-statutory status.

The legislation seeks to empower the PFRDA to regulate the New Pension System (NPS), which is based on the principle that “you save while you earn”, especially for retirement, and is mainly for those who have a regular income, Finance Minister P. Chidambaram said while replying to the debate on the bill in the house.

The new legislation would also provide subscribers a wide choice to invest their funds, including for assured returns by opting for government bonds as well as in other funds depending on their capacity to take risk.

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