Pension for government employees gets headlines again, but what about pensions for the poorest

With new announcements pension schemes for government employees are in headlines again. As well-informed and educated government employees are very keenly involved in getting better pension benefits, certainly all aspects of these pension schemes will be explored in great detail and occupy a lot of media space in the coming days, but in the middle of all this where is the concern for the pension rights of those who need these the most—the poorest? Where is the concern for universal pensions which remain elusive even 77 years after independence?

Don’t workers and peasants get old and don’t they need some protection for their old age? Isn’t it true that due to their hard life they tend to age early and are even more in need of old age support? Isn’t it true that they have hardly any savings after all their long years of relentless toil and therefore are even more in need of pension?

As opposed to the need for universal pension, at the best we only have some sporadic schemes which cover only a small section of the poor. What is more, the performance of some of these schemes has deteriorated instead of improving. In the context of the provision of pensions for construction workers under the 1996 laws, for example, extensive interviews with construction workers in Delhi conducted by this author in recent months have revealed that new pensions have almost stopped for eligible persons, in some cases pensions previously received are not coming in now, and there has been no progress on a large number of pension applications filed by newly eligible persons.

In the course of these interviews I talked to several elderly men and women in slums, many of whom came with their papers relating to their applications, and they almost broke down while narrating their grievances and difficulties.    

Nothing is as reassuring for the elderly as the certainty of receiving a reasonable pension regularly, but this satisfaction is denied to the majority of senior citizens of India. In times of increasing price rise, the importance of pensions has increased all the more for elderly citizens, but the Indian government has paid scant attention to providing relief to senior citizens.

This is extreme sad as the lack of pensions can make a life and death difference to many elderly persons, denying them some years of life. However in India leaving aside government employees and a few others, reasonably adequate pension benefits have been denied to other elderly citizens.  Only about 10 per cent of senior citizens in India have access to regular and reasonablly adequate pensions. In addition about 25 to 30%% others get inadequate benefits whle about 60 to 65% do not get any benefits at all.

 The leading program of the union government for providing some basic relief to elderly people in the informal sector is known as the National Social Assistance Program (NSAP), administered by the Rural Development Ministry. (see State of Pensions Report,  Helpage India). Out of the over 80 million elderly citizens in the informal sector, this scheme of the Union Government manages to reach just about 22 million people. Hence there is clearly a pressing need to reach out to many more elderly people which would require more resources.

However the reality of NSAP is that the fund allocation for this very important scheme has been stagnant, the only exception being 2020-21 when the NSAP was used additionally as the vehicle for providing a significant share of the special COVID packages. If we exclude these benefits given only this year and look at the regular pension component only, then it is clear that the funding of this important scheme has stagnated badly and in real terms may even have declined in recent times.

While most of the elderly persons do not get pension, some others who used to get pension earlier have also been denied pension more recently. In several villages which I visited in recent years I heard frequent and distressing complaints from elders stating that earlier they were getting pension, even if it was delayed, but now they are not getting. This has happened due to a number of factors. One aspect relates to insistence on Aadhar and biometric recognition, while in other cases problems are caused by various irregularities and other factors. The system of redressal of grievances has been generally found to be quite poor and inadequate.

There are some other pension schemes also but their coverage is much lesser.  What is more, the amount provided by the Union government under NSAP is very low and has remained the same for over a decade, despite the big price increase since then. The NSAP has different amounts of pension for two age-groups—60 to 79 years and 80 years onwards. In the second age-group the Union government provides Rs. 500 per month per person. However the overwhelming majority of the elderly people in India are in the former age-group. For this age group the contribution of the Union government has been just Rs. 200 per month for a very long time

 At a time when pensions provided to high salary officials as well as politicians in most elected posts have been increased regularly, the pension given to farmers and workers, if they get it all, has been kept at an extremely low level for about a decade . During this period the value of this amount (Rs. 200) in present day prices has dwindled to just about Rs. 85 or so.

To this amount provided by the union government the state government generally adds a contribution of its own under this scheme. In some of the smaller states like Goa, Kerala and Delhi the state governments have contributed a much higher amount so that often people get close to Rs. 2000, but  most state governments contribute just around  Rs. 400 or Rs. 500  or even less.

 There have been several protests against this injustice, including those organised by the Pension Parishad, an alliance of over 100 organistions working on this issue. At the time of one such big protest in Delhi in 2013,  the then Rural Development Minister Mr. Jairam Ramesh accepted that the existing situatin is very unfair to the elderly and gave a commitment to improving the pension arrangements in signficant ways. What the UPA government should have done was to initiate such overdue reform immediately.

However after the 2014 election the government changed and the new government did not increase the NSAP budget in any significant way, although it launched a few pension schemes for the poor on its own which, however, are very inadequate.

 Subsequently, in another big protest with particiption of activists and elders from many parts of country, a demand for substantially increasing the reach and amount pf pensions was raised  The Pension Parishad then demanded a pension of Rs. 3000 per month or one half of the  minimum wage rate which should be available to all senior citizens ( leaving aside only those senior citizens who are already getting a higher pension or else are still earning enough to be in the income tax paying category). This objective can be achieved if the NSAP can get an allocation of around 2 per cent of GNP which is achievable.

The government if it is sincere about helping the senior citizens should go ahead with implementing a scheme of universal pensions. The opposition parties should also give this issue a very prominent place in their agenda.

 Bharat Dogra is Honorary Convener, Campaign to Save Earth Now. His recent books include Planet in Peril, A Day in 2071, Protecting Earth for Children and Man Over Machine.