Universal pension scheme for 100m people launching today

The government is set to launch a universal pension scheme for 100 million people on Thursday.

As per the finance division of the finance ministry, the population aged over 60 is projected to rise to 31 million in 2041 from 12 million in 2020.

Hence, the government is introducing the first-ever universal pension scheme to encompass this significant demographic within a sustainable and organised social safety net. This initiative aims to provide protection for 85 per cent of the population within the low-income bracket and those employed in the informal sector.

Replying to a query on the number of people to be brought under the coverage of the universal pension scheme, a responsible official of the National Pension Authority said on Wednesday that the government is mulling over giving protection to 100 million people aged over 18 at home and abroad under this pension scheme. The Pension Authority stated that the average life expectancy of people is increasing, leading to a rise in the aging population and their sense of insecurity. This is the driving factor behind the introduction of the universal pension scheme.

Prime minister Sheikh Hasina will inaugurate the pension scheme at 10:00am on Thursday. After that, any Bangladeshi citizen aged over 18 can take up this scheme at home and abroad. Finance minister AHM Mustafa Kamal. Bangladesh Bank governor Abdur Rauf Talukder, finance secretary Fatima Yasmin, and National Pension Authority chairman Kabirul Ezdani Khan, among others, will present at the event.

Initially, there will be four different schemes – Pragati, Surokkha, Samata and Prabashi – under the universal pension scheme.

The Pragati scheme will cover private job holders, the Surokkha for rickshaw pullers, workers, potter, smiths, fishermen, weavers and self-employed persons, the Samata for people with the low-income and the Prabashi scheme will cover expatriate Bangladeshis.

The National Pension Authority is tasked with implementing and operating the universal pension scheme. They opened their website (www.upension.gov.bd) on Wednesday. The website says “Join the universal pension scheme, ensure you financial security.” Initial information on pension schemes is also available on the website.

One must have the national identity (NID) card to avail pension schemes. Expatriates who do not have NID can open a pension scheme with a passport, but they must submit their NIDs as soon as possible.

Background of launching universal pension scheme

Though the universal pension scheme was launched today, late finance minister Abul Maal Abdul Mihith first took the initiative to introduce it in 2015. He prepared a concept paper after vesting India in 2016. Abul Maal Abdul Muhith, however, could not finish it. The initiative gained a momentum in 2022 and the finance division prepared another concept paper, and the Universal Pension Management Act 2023 was passed in 31 January this year and the National Pension Authority was formed on 12 February under it.

Finance minister said in his budget 2023-24 speech that prime minister Sheikh Hasina promised in the 2008 election manifesto that a universal pension scheme would be introduced nationally for the ageing population under a sustainable and organised social safety net progamme to ensure their old aged protection. In constitution to this, the government formulates the National Social Security Strategy (NSSS) in 2015 and it proposed to create of a large scale coordinated inclusive pension system in the country.

About the feature of the pension scheme, the National Pension Authority’s website states separate ledger will be maintained for everyone enrolling at pension schemes. One will start receiving pension at the age of 60. If someone dies before 75 years, his/her nominee will receive the monthly benefit for the reaming period until the age of the actual pensioner reaches 75. If someone dies before 10 years of pension scheme, his/her nominee will receive the deposited money with profit. Pension money will be considered as investment and monthly pension fees will be tax free.

How to get enrolled

To be included in the pension scheme one has to register on the website of the pension authority. A page will appear at first reading, “I hereby certify that I am not working in any government, semi-government, autonomous or state-owned organisation. I am not benefited from any other government or autonomous organisation other than the universal pension scheme. I don’t receive any allowances under the Social Safety Net Programme.”

One can go to the second page to start the registration process by clicking the “I agree” button on the first page. Here the applicant will have to choose one from four schemes - Pragati, Surokkha, Samata and Prabashi. At the same time, the applicants need to write the 10, 13 or 17-digit national identity card number, death of birth, mobile number and email on the second page. Then he or she will have to fill up the CAPTCHA at the bottom of the page.

A page for providing personal information will appear in the third phase of the registration process. The name of the applicant in Bengali and English, names of the applicant’s parents, present and permanent address will appear automatically on this page as this information was already filled up on the first page.

However, the applicant will have to mention his or her annual income on this page as well as names of his or her division, district, upazila and profession. There are several options in the occupation section, including teaching, private job-holder, small business, business, day-labourer, lawyer and journalism. The applicant will have to choose from these professions. After filling all the entries on this page, the “scheme information” page will appear.

On this page, the applicant will have to select the amount of monthly installment and the mode of payment. There are three options for payment – monthly, quarterly and yearly.

This page is followed by the bank information page. The applicants will have to mention his or her account name, number, and the type of the account, routing number, name and branch of the bank.

The applicants will have to provide the information of the nominee on the next page. One will have to put the NID number and date of birth of the nominees here. At the same time, one will have to provide the nominee’s mobile number, his or her relationship with the applicant and the percentage of share to be received by the nominees (in case of more than one nominee).

The next page is the last step of the registration process. This page will show the personal information, scheme information, bank information and nominee information, which have been provided in the previous stages and the applicant can correct an information in case of any error. And if all the information is right, then the applicant will have to finish the registration process by clicking the “I agree” button on the page. One can even download the entire application as well.

Registration through Sonali Bank

Registration for the universal pension scheme opens Thursday. One can register online or in-person at any branch of Sonali Bank, and pay the pension fee. Besides, pension fee can be paid through mobile financial service (MFS) providers.

Sources at the Pension Authority said Sonali Bank has opened four separate accounts for pension schemes and pension fees be deposited to these accounts. And, more banks will join the universal pension scheme later.

However, individuals' monthly contribution to the universal pension scheme varies. Prabashi scheme’s fees are Tk 7,000, Tk 7,500 and Tk 10,000; Pragati scheme’s fees are Tk 2,000, Tk 3,000 and Tk 5,000 and Surokkha scheme’ fees are Tk 1,000, Tk 2,000, Tk 3,000 and Tk 5,000 while Samata scheme’s fee is Tk 1,000, of which, person availing this scheme will pay Tk 500 and the government will pay the reaming Tk 500.

Sonali Bank managing director Md Afzal Karim told Prothom Alo on Tuesday, “All of our 1,229 branches in the country are ready to provide service for the universal pension scheme as we have signed agreement with the National Pension Scheme.”

Whether one has an account at Sonali Bank or not, anyone aged over 18 can pay the fee for pension scheme filling the certain form through this bank, he added.