The government is planning to introduce a universal pension scheme for both formal and informal institutions operating in the country.
To this end, a "Universal Pension Authority" will be formed soon for gradual introduction of the universal pension scheme for everyone including all employed in formal and informal sectors of the economy, according to the budget document unveiled on Thursday for the next fiscal year (FY).
Earlier in 2018, former finance minister AMA Muhith also pledged the same as part of efforts to support financially the elderly people at a time when their income falls.
Mr Muhith said: "Therefore, we want to introduce a universal pension scheme for all working population engaged in private sector, both formal and non formal."
However, the budget speech for the FY 2019-20 said government service pensioners are only a small fraction of the total population in the country.
A total of 3.5 million elderly poor people, in addition to the government service pensioners, are getting old-age allowance of Tk 400 per month.
This number represents only a quarter of the total elderly population. However, the amount is not sufficient for a decent living.
According to the government plan, under the proposed arrangement, an employee will subscribe a specific amount to the pension fund having registered his name under the government-administered pension scheme.
Where applicable, the appointing authority will also deposit a specific amount into the employee's pension account.
The fund thus constituted will be invested and the income generated will be accumulated there.
In the meantime, the process of pension payment for the public servants through EFT started reducing the hassle of pensioners in getting their pension money.
"System has been introduced so that pensioners can automatically get their pension in their bank or mobile account without any physical presence in any accounts office or any bank," said the budget speech, a part of which was read out by Prime Minister Sheikh Hasina on behalf of the Finance Minister.
Payment of pension funds directly to 27,000 pensioners' bank accounts through EFT has already been made.
"All [government] pensioners will be brought under this system in the next fiscal year (2019-2020)."
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