Following the completion of scores of development projects including Padma Bridge, Metrorail, and Karnaphuli Tunnel, the government is set to announce another project that will significantly improve the lives of the country's citizens as a whole. That is the start of the universal pension scheme. Although there was discussion of starting this program long ago, now it is going to take shape in reality. Bangladesh plans to formally inaugurate it on August 17 as evidence of its expanding economy and shift to a welfare state.
If the universal pension system is introduced, more than eight crore people in the country will come under this scheme. According to the latest BBS survey, the total labour force in the country is 5 crore (87 lakh). Out of this, 5 percent are government employees, and 10 percent are employed in the private sector. This 15 percent is the institutional sector of the country, and the remaining 85 percent is the non-institutional sector. But, only government, semi-government, or autonomous organization employees get pension benefits after retirement.
According to the law passed by the National Parliament, all working people in the country will be covered under the pension scheme. Even Bangladeshis who are working abroad can also be included in it. This universal pension system is designed to provide social security and government assistance to citizens due to unemployment, illness, disability, or old age, bringing a sustainable safety net to the aging population.
At different stages of the life cycle, people face various risks, shocks, hazards, and disasters. The degree of risk varies from layer to layer. For example, the risk of a sixty-year-old person is more challenging than the risk of an active person. During this time, a person suffers from various handicaps, including breakdown, loss of income, lack of care, and loss of stamina. In this context, social security is absolutely necessary for everyone in the last stage of their life cycle, or old age.
Again, Bangladesh is now experiencing a demographic dividend. More than half of the country's population is currently between the ages of 18 and 50. By 2030, this country is waiting to enter the stage of an elderly nation. Currently, the number of elderly people in the entire country is 1.13 crore, which is 8 percent of the total population. In 2025, the total number of senior citizens will be 2.80 crore. In 2050, this number will be 4.50 crore, and in 2060, it will be 5.61 crore. In 2050, the elderly population in the country will be 20 percent.
The current average life expectancy in the country is 73 years. This rate is projected to be 80 years in 2050 and 85 years in 2075. The number of seniors will increase at a faster rate. Therefore, it is the state's duty to establish official state policies to guarantee these persons' protection as they age.
On the other hand, it should be noted that our per capita income is also increasing. A large part of our manpower is now employed, and the poverty situation has also improved dramatically, benefiting the continuation of inclusive progress. So, they can afford to invest some money for their later years from now on. In this context, it was the need of the hour to introduce a pension scheme for all citizens.
The present social safety network, which was initially established as a relief program in the 1970s, has played a praiseworthy role in reducing poverty and vulnerability. This protection mechanism will be strengthened by the universal pension plan. The most significant aspect of this program is that it has prioritized the protection of the low-income and underprivileged population by including them in the program. The Universal Pension Scheme is quite new in Bangladesh, though it is timely. The country has an impeccable track record of success in implementing social safety net programs. The accumulated experience will surely help in this case too.
This pension plan will initially be available in four categories: Probash, Progati, Shurakha, and Samata.With government assistance, the Samata Plan is designed for the marginalized poor. The monthly payment for a scheme holder in this category is set at 1,000 Tk, of which the government will contribute 500 Tk and the remaining Tk will be provided by the recipient. The Shurokha package is another program created specifically for self-employed and unorganized sector employees like farmers, rickshaw pullers, and day labourers. They could deposit Tk 1,000, Tk 2,000, Tk 3,000, or Tk 5,000 each month, and their monthly pension would range from Tk 1,530 to Tk 172,327.
Private sector employees are eligible for the Progoti plan. In this category, employers are supposed to pay 50 percent of their employees' monthly installments of Tk 2,000, Tk 3,000, and Tk 5,000. If private companies do not pay for their employees, they could buy the schemes for themselves.
Bangladesh's migrant workers also have the option to take advantage of the universal pension scheme's benefits. They can choose from three installment options, each of which must be paid in foreign currency: Tk 5,000, Tk 7,500, and Tk 10,000. If an expatriate of 18 years of age pays a monthly installment of Tk 10,000, after 42 years, he or she is entitled to withdraw a monthly amount of Tk 3,44,655. Similarly, a private sector employee, if he or she puts in a monthly deposit of Tk 5,000, will receive a monthly benefit of Tk 1,72,327 after the same 42 years.
Of course, this is not a new idea. This scheme has also been launched in the neighbouring country of India. This scheme is active in many developed countries, including the Netherlands. In fact, this idea originates from the idea of the welfare state. Present government can certainly be thanked for initiating this program in Bangladesh.
Public trust in the government depends on welfare programs. The universal pension system is undoubtedly a milestone in the establishment of the welfare state. Equitable distribution of wealth is the motto of a welfare-democratic state. The nation-wide 'Universal Pension System' will be a unique social security initiative of the country. We hope that, with a universal pension scheme, Bangladesh can ensure a more humane life for its future senior citizens.
The writer is a Researcher and Strategic affairs analyst
