The government is set to introduce pension facility for all private sector jobholders in the country within next three year. The authorities concerned are working to formulate an action plan to this end. It is learnt that Finance Minister AHM Mustafa Kamal is likely to present an outline of the universal pension policy in the upcoming national budget, elaborating how the policy can be implemented and who will be under the purview of the policy, said officials.
In April last, the finance ministry formed a committee headed by an additional secretary, to prepare a draft outline of the universal pension policy.
The committee submitted its report to the ministry recently, according to sources concerned. According to the draft outline, every employee covered under pension facility will have a unique number. The employee would deposit a certain amount from his income to the pension fund. The employer also will contribute to the fund. The government will invest the fund money in different sectors. The pensioner will be given a fixed amount every month from the profit made through the investment.
A senior finance ministry official told the Bangladesh Post, “The employee who would deposit more money from income would get more money back as pension. But, at first, a policy has be formulated.” He said, “Even if an employee switches job from one organisation to another, his pension fund number would remain the same, and the programme will continue. If someone becomes unemployed for a certain period of time, he would have to deposit the monthly amount to pension fund from his own expense.”
The official, however, observed that details of how the pension policy can be implemented, or how much it will cover, would be finalised once the policy is approved by the government. “In our neighbouring country India, it took almost two decades to implement a universal pension policy,” the finance ministry official said, adding that considering the socio-economic context of Bangladesh, economists believe that implementing the policy would be a difficult job.
Contacted, former governor of Bangladesh Bank Dr Saleh Uddin Ahmed said, “The initiative is undoubtedly good, but implementing it universally is not easy.”
Mentionable, pensioners of the public sector constitute the ‘smallest portion’ of the elderly population of Bangladesh, he said. Currently, only five percent of the country’s total employees enjoy pension facility at present. All of them are either government officials or serving under autonomous organisations.
Rest of the 95 percent employees of the country serve at private organisations. Of them, only 10 percent enjoy facilities like appointment letter, salary structure and regular holiday. Rest of the 90 percent employees do not even enjoy those facilities, let alone pension. Besides, a total of 3.5 million elderly poor people, in addition to government 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, experts said.
They said, “It is obvious that following the normal demographic trend, the proportion of elderly population will also increase in our country like developed countries”. A former finance minister in the last budget speech, said, “Considering the overall situation, we hope to start the work of introducing a sustainable universal pension system for all working people engaged in formal and informal works at the private level.”
But that promised work did not start at all; as no outline for universal pension policy has been obtained yet. The concerned people say structural reform is needed to introduce universal pension policy, which is time consuming.
