Sources said the new plan aims to extend the scope of social security beyond traditional employment.
The central government is reportedly developing a “universal pension plan” that will be used for all citizens, NDTV’s report cited the Ministry of Labor sources. The program will be voluntary and contributive to extend social security beyond traditional employment. The program will also be open to all salaried employees, workers and self-employed individuals. Currently, people in unorganized departments, including construction workers, domestic workers and gig workers, are unable to access large government-run savings plans.
New proposals and existing plans
Sources say the main difference between the new proposal and existing plans such as the Employee Provident Fund Organization (EPFO) is that contributions to the former will be voluntary. Therefore, the government will not make any contribution in its aspects. The general idea is to provide a “universal pension plan” to simplify the country’s pension/savings framework by possibly including some existing plans, the source added.
The new plan, temporarily called the “new pension plan” and will not replace or include the existing National Pension Plan (NPS), will also be a voluntary pension plan, the source added. Sources said that once the proposal documents are completed, stakeholder consultation will begin.
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Current pension plan for unorganized departments
Currently, the government provides several pension schemes for unorganized sectors, such as Atal Pension Yojana, which provides Rs 1,000-Rs 1,500 per month after investors turn 60. Seeking to benefit street vendors, domestic workers and laborers, etc. For farmers, there are plans, such as Pradhan Mantri Kisan Mandhan Yojana, which offers Rs 3,000 a month after the investor is 60 years old.
