Union Finance Minister Piyush Goyal, who presented the Centre’s interim Budget on Friday, announced a mega pension scheme for workers in the unorganised sector.
Goyal said the scheme will benefit 10 crore workers and it will be implemented from the current year. The scheme will cover workers with monthly income up to Rs 15,000.
Workers who enrol for the Pradhan Mantri Shram Yogi Maandhan will get Rs 3,000 per month after the age of 60. They will need to contribute a nominal amount every month during their working age – those who join the scheme at the age of 18 will need to pay just Rs 55 a month. The government will deposit an equal share in the worker’s pension account every month.
The finance minister said the Centre has allocated Rs 500 crore for the scheme.
Here is the part of Goyal’s speech in which he made proposals about the mega pension scheme:
- After submission of the 7th Central Pay Commission Report, the recommendations were implemented immediately. The New Pension Scheme (NPS) has been liberalized. Keeping the contribution of the employee at 10%, we have increased the Government contribution by 4% making it 14%. Maximum ceiling of the bonus given to the labourers has been increased from Rs 3,500 per month to Rs 7,000 per month and the maximum ceiling of the pay has been increased from Rs 10,000 per month to Rs 21,000 per month. The ceiling of payment of gratuity has been enhanced from Rs 10 lakh to Rs 20 lakh. During the last five years the minimum wages of labourers of the all categories have been increased by 42%, which is the highest ever. The ceiling of ESI’s eligibility cover has been increased from Rs 15,000 per month to Rs 21,000 per month. Minimum pension for every labourer has been fixed at Rs 1,000 per month. In the event of death of a labourer during service, the amount to be paid by EPFO has been enhanced from Rs 2.5 lakh to Rs 6 lakh. Under Anganwadi and Asha Yojana honorarium has been enhanced by about 50% for all categories of workers.
- Half of India’s GDP comes from the sweat and toil of 42 crore workers in the unorganised sector working as street vendors, rickshaw pullers, construction workers, rag pickers, agricultural workers, beedi workers, handloom, leather and in numerous other similar occupations. Domestic workers are also engaged in big numbers. We must provide them comprehensive social security coverage for their old age. Therefore, in 9 addition to the health coverage provided under ‘Ayushman Bharat’ and life & disability coverage provided under ‘Pradhan Mantri Jeevan Jyoti Bima Yojana’ and ‘Pradhan Mantri Suraksha Bima Yojana’, our Government proposes to launch a mega pension yojana namely ‘Pradhan Mantri Shram-Yogi Maandhan’ for the unorganised sector workers with monthly income upto Rs 15,000. This pension yojana shall provide them an assured monthly pension of Rs 3,000 from the age of 60 years on a monthly contribution of a small affordable amount during their working age. An unorganised sector worker joining pension yojana at the age of 29 years will have to contribute only Rs 100 per month till the age of 60 years. A worker joining the pension yojana at 18 years, will have to contribute as little as Rs 55 per month only. The Government will deposit equal matching share in the pension account of the worker every month. It is expected that at least 10 crore labourers and workers in the unorganised sector will avail the benefit of ‘Pradhan Mantri Shram-Yogi Maandhan’ within next five years making it one of the largest pension schemes of the world. A sum of Rs 500 crore has been allocated for the Scheme. Additional funds will be provided as needed. The scheme will also be implemented from the current year.