In a proposal set to provide pensions to all citizens above 18 years of age, the Central Government has decided on a Universal Pension Scheme. This scheme, if introduced, would be an important step for all working citizens of the country. At present, pensions are granted only to employees of the organized sector. However, the goal of UPS is to introduce pensions to workers of the unorganized sector, small traders, shopkeepers, laborers, and self-employed persons. Besides, this scheme will be implemented on a voluntary basis for engagement in pension coverage, thus enabling large participation.
What Is The Universal Pension Scheme?
Universal Pension Scheme aims at giving pension benefits to all citizens. This scheme will work as a contributory pension scheme in which every citizen has to contribute some amount every month and, in return, receive a regular pension after attaining the age of 60 years. It also aims to provide pensions for persons who are working in the unorganized sector or self-employed. Specially keeping in mind the growing elderly figures in India, this will serve to provide them with social and economic security in old age.
Objective Of The Universal Pension Scheme
The number of elderly persons in India is rising day by day, and these elderly classes do not have much financial security for their old age. To combat that, the government is working on UPS. The objective of this scheme is to adopt a voluntary and contributory method to come under the purview of pensions. In this, the person will deposit some amount every month and the government will also make its contribution. In this way, a certain amount will be deposited in the pension fund and paid back in pension form at the age of 60. The objective of the government is that not only government and private sector employees, but also working persons of the unorganized sector can get the benefit of pension. The small trader today is without any scheme of pensions but could become part of this and secure his future office with an old age income.
The Method Of Implementation Of The Universal Pension Scheme
The UPS would be implemented as a contributory pension scheme. In other words, this scheme will require every citizen to deposit some amount every month with a contribution from the government. Under this scheme, while a person will be 60 years of age on eligibility for pension, the actual amount of pension will be calculated on the basis of the amount deposited into this pension fund, the government contribution, and returns accruable thereon.
Importance And Impact Of Universal Pension Scheme
With respect to an ever-increasing elderly population in India, the importance of the scheme is well manifested. Specially, those who have worked in the un-organised sector and do not have any provisions for a pension in their old age will be beneficiaries of this scheme.Through this scheme, the government shall guarantee some financial security to every citizen in old age so that he is able to live his last days with dignity. The central government may assign the responsibility for drafting of the scheme to the Employees’ Provident Fund Organization (EPFO) for its implementation. Subsequently, public comments will be invited; and after approval, implementation will take place so that citizens across the nation can avail of the scheme’s benefits.
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