Muhith for introducing universal pension scheme

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DHAKA, June 7, 2018 (BSS) – Finance Minster AMA Muhith today said the
government wants to introduce a universal pension scheme for all working
people engaged in private sector to cascade down the benefits of economic
growth to everyone and cut down social discrimination.

Outlining the pension scheme in the budget speech, the Finance Minister said
under the proposed arrangement, an employee will subscribe a specific amount
to the pension fund having registered his name in the government administered
pension scheme.

Noting that the appointing authorities will also deposit a specific amount
into the employee’s pension account, he said following its earlier
commitment, the government will deposit a specific amount into the pension
fund in the cases of ultra-poor workers.

The fund thus constituted will be invested and the income generated there
will be accumulated here, he added.

However, Muhith said, introduction of a universal pension scheme calls for
fundamental structural reforms, which will take time and entail huge cost.

Pensioners of the public sector constitute the smallest portion of the
elderly population of the country. Currently, a total of 7-8 lakh families of
retired government employees and several private organisations get pensions,
he said, adding that a total of 35 lakh elderly poor people, in addition to
government pensioners, are getting old-age allowance of Tk 400 per month
each.

This number represents only a quarter of the total elderly population.
However, the amount is not sufficient for a decent living.

Observing that following the normal demographic trend, the proportion of
elderly population will also increase in the country, the Finance Minister
said it will then be difficult to support them through budget transfers while
the government is firmly committed to cascade down the benefits of economic
growth to everyone, and reduce income inequality and social discrimination.

He said it is necessary to work out appropriate policy-strategy and action
plan and put in place technical capacity to bring equity and consistency
between the pension awarded to the public sector employees and the working
people engaged in private sector both at formal and non-formal outfits.

“We have a plan to introduce this system on pilot basis,” he added.

 

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