Pension Schemes in India: The Missing Links


The aged are an extremely vulnerable section of the population who depend on pension schemes run by the state and central governments. Amidst extremely low pensions and inefficient allocation initiatives, the aged continue to face difficulties.

Kabir | The New Leam

There are many persons in India who are above the age of 60 years and below the poverty line in India. These are the people who are eligible for the pension scheme which gives them an amount of money every month in order to sustain them. Keeping in tune with Article 41 of the Indian Constitution which reminds the Indian state to take care of individuals in case of unemployment due to disabilities, old age etc. The pension scheme provides social assistance to a large number of senior citizens.  Although the pension scheme is of great significance it becomes important to acknowledge that with growing inflation and a rise in expenses, the amount offered in the form of pension may not be enough to enable the elderly to lead a dignified existence.

The Indira Gandhi Old Age Pension Scheme is one of the oldest such schemes and covers a large number of the elderly population. Under the scheme, a meager Rs 200 is paid per month for each person.

This scheme is administered by the Ministry of Rural Development under the National Social Assistance Program (NSAP). It is estimated that there 10.3 crore elderly people in India who should be getting pension, the IGNOAPS covers only 3.5 crore of them.

Under this scheme, beneficiaries who fall within the category of 60-79 years receive a monthly pension of Rs 300, from which Rs 200 would be paid by the central government and the remaining amount Rs 100 (upto to Rs 2,000) is meant to be paid by the state government (variable).

Those above 80 years of age receive an amount of Rs 500 through the scheme. There is an urgent requirement to enhance the amount of Rs 200 paid by the central government to enable senior citizens to really lead a dignied life.

The Atal Pension Yojana (APY) under the Ministry of Finance is meant for the unorganized sector. Under the budgetary allocation, APY has been reduced from Rs 170 crore in 2017-18 to Rs 155 crore for 2018-19.

Schemes like Aam Aadmi Bima Yojana and interest subsidy to the Life Insurance Corporation for the Pension Plan for Senior Citizens have also been reduced. There have been several protests and demands over the recent years to increase the meagre amount paid in pensions but despite these protests, there have been no steps to actually increase the pension amount.

It is paradoxical that despite the fact that several protests and demands have been made to increase the pension amount, there has been insignificant measures by the government. The amount that is offered in the scheme is extremely less and not sufficient to enable the poor and the old to lead a life of dignity. The problems of improper allocation, poor coverage and Aadhar Card linking have made the beneficiaries of the scheme experience immense difficulty. The government must ensure that the amount offered in pension is enhanced and its allocation is ensured smoothly so that the elderly persons may actually benefit from it.


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