New Delhi, April 25: The Congress-led government is likely to negotiate changes in the Pension Funds Regulatory and Development Authority bill with the Left leadership.

Finance ministry sources today indicated the government could enter into a dialogue once the standing committee on finance comes out with a report on the bill, which was earlier introduced in Parliament amid a walkout by the Left.

CPM general secretary Prakash Karat has since warned the government to withdraw the bill, saying the party did not want to embarrass it on what is, essentially, a money bill. This is seen as a veiled threat since the bill might not pass through Parliament without the CPM's support. In such a situation, the government would have to resign under constitutional norms.

The BJP has not indicated whether it will eventually support the bill, though the party had allowed it to be introduced in the Lower House. This has deepened the uncertainty.

The convention that government must resign if it cannot muster support for a money bill was used earlier by the CPM to stop the Congress-led government from raising the foreign investment limit in the Insurance Regulatory Act through an amendment.

?Let the standing committee report on suggestions for changes in the bill come .... the Left is part of the committee too,? a top finance ministry official said.

Although the bill is ostensibly aimed at setting up a body to regulate the new defined pension plan brought in last year, it also empowers the agency to control all schemes.

It could even take away from lawmakers their right to discuss controversial issues such as foreign investment in new pension funds and the investment pattern. This could mean norms on whether the amount can be invested abroad. The proportions to be parked in stocks and government bonds will also have to be settled.

A more conciliatory tone has started emanating from the North Block. Interim PFRDA chairman D. Swarup said today that pension funds will be managed by ?Indian companies?. However, this is at variance with finance ministry?s initial stand on allowing 100 per cent FDI in the sector.

To allay some of the fears, Swarup said the bill provides jail terms up to 10 years for errant fund managers, apart from cancellation of their licences.