RIDERS IN PEN­SION SCHEME

Riders will leave out a ma­jor­ity of the in­tended ben­e­fi­cia­ries, also the exit clause is harsh

The New Indian Express - - INDIA -

WITHIN a week of Fi­nance Min­is­ter Piyush Goyal an­nounc­ing a new pen­sion scheme for the un­or­gan­ised sec­tor, a no­ti­fi­ca­tion from the labour min­is­ter has put a num­ber of riders, leav­ing a ma­jor chunk of the in­tended ben­e­fi­cia­ries out. Ac­cord­ing to the Min­istry of Labour and Em­ploy­ment no­ti­fi­ca­tion is­sued on Fe­bru­ary 7, an un­or­gan­ised worker above 18 and be­low 40 years, with a monthly in­come less than `15,000, can join the ‘Prad­han Mantri Shram Yogi Maan-dhan 2019’ scheme. This al­lows for a `3,000 per month pen­sion from the age of 60 years, start­ing Fe­bru­ary 15. This scheme is open to those with sav­ing ac­counts and Aad­haar. It said per­sons cov­ered un­der Na­tional Pen­sion Scheme, con­trib­uted by the Cen­tral Govern­ment or Em­ploy­ees’ State In­sur­ance Corporation Scheme un­der the Em­ploy­ees’ State In­sur­ance Act, 1948, or Em­ploy­ees’ Prov­i­dent Fund Scheme un­der the Em­ploy­ees’ Prov­i­dent Fund, can’t join the scheme. An­other rider is that only spouses can be the nom­i­nee and can avail 50 per cent of the pen­sion if the ben­e­fi­ciary dies. Af­ter the death of the sub­scriber and spouse, the cor­pus will be cred­ited back to the Pen­sion Fund. The no­ti­fi­ca­tion also said that if an el­i­gi­ble sub­scriber de­faults in the pay­ment of the con­tri­bu­tion, he shall be al­lowed to reg­u­larise his con­tri­bu­tion by pay­ing the en­tire out­stand­ing dues along with in­ter­est at the rate de­ter­mined by the Min­istry of Labour and Em­ploy­ment from time to time. The no­ti­fi­ca­tion also has a harsh exit clause. “In case an el­i­gi­ble sub­scriber ex­its this scheme within a pe­riod of less than 10 years from the date of join­ing the scheme, then the share of con­tri­bu­tion by him only will be re­turned to him with sav­ings bank rate of in­ter­est payable thereon,” the no­ti­fi­ca­tion added. Ex­perts claim that the no­ti­fi­ca­tion will leave a ma­jor­ity of peo­ple out. “I do not think this is a labour friendly ini­tia­tive,” a mem­ber of All In­dia Cen­tral Coun­cil of Trade Unions said.

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