NEW DELHI, Feb 27: The Central government is considering the introduction of a Universal Pension Scheme to provide social security for every Indian, with ongoing discussions taking place within the Ministry of Labour and Employment to shape the framework for this ambitious initiative.

Although no official communication has been made about the scheme yet, reports suggest it will be voluntary, allowing individuals to participate regardless of their employment status. This means anyone willing to make monthly contributions can enroll and receive pension benefits, unlike existing pension schemes that are tied to specific jobs or sectors. The scheme is expected to be inclusive of workers across all industries, including those in the unorganised sector, many of whom currently lack access to pension benefits.

Currently, workers such as gig workers and domestic staff do not have access to pensions. The Universal Pension Scheme aims to provide financial security for those excluded from existing pension programmes, significantly altering the landscape of retirement security. The Employees’ Provident Fund Organisation (EPFO) is expected to be the nodal agency responsible for designing and implementing the scheme.

Reports indicate that the government may also contribute to the pension accounts of beneficiaries, either on a monthly or quarterly basis, to incentivize participation. This approach is similar to existing voluntary pension schemes like the National Pension Scheme (NPS) for traders and self-employed individuals and the Pradhan Mantri Shram Yogi Maandhan (PM-SYM), which provides a monthly pension of Rs 3,000 after the age of 60. These existing schemes require contributions ranging from Rs 55 to Rs 200, with the government matching the amounts.

As part of the new initiative, the government is considering merging some of these existing pension schemes, including the Atal Pension Yojana, into the Universal Pension Scheme. The Atal Pension Yojana, which is regulated by the Pension Fund Regulatory and Development Authority (PFRDA), provides retirement benefits to low-income workers.

Additionally, authorities are exploring the use of the cess collected under the Building and Other Construction Workers (BoCW) Act to fund pensions for construction workers specifically. If implemented, the Universal Pension Scheme could be a game-changer for millions of workers, particularly those in informal jobs, ensuring they have financial stability in their later years.