Universal Pensions For the Elderly Are Not Only Desirable But Also Realisable

There is an intensified need for the state to provide adequate, regular pensions for the elderly.

Representative image. Credit: CDC Global/Flickr CC BY 2.0

Representative image. Credit: CDC Global/Flickr CC BY 2.0

It is often said that one of the best indicators of the values of any society is the care provided to the elderly. While Indian society has several traditional values of caring, social security provided by the government remains highly inadequate. Nearly 90% of the elderly work or worked in the unorganised sector and do not have the benefit of employment-linked pensions that most (though not all) elderly people in the organised sector have.

On the whole, there are about 102 million elderly people above the age of 60 in India and out of these over 90 million are from the unorganised sector. At present, only about 20% of them receive pensions under the Indira Gandhi National Old Age Pension Scheme (NOAPS). The NOAPS provides just Rs 200 per month to elderly people who fall in the below poverty line category between the ages of 60 to 79 years and Rs 500 a month to those aged 80 and above. Additions to this may or may not be made by state governments. This means that there is Rs 1,000 or more per month pension in states like Goa, Delhi and Tamil Nadu, but also states like Bihar and Odisha, where the pensions are closer to Rs 500 or less.

At present, pensions do not reach over 70% of the elderly in India, which is over 70 million people. Close to 15 million elderly receive a pension that is less than Rs 1,000 per month. This is clearly a very unsatisfactory situation and highly unjust to our elderly people.

The need for pensions is increasing, particularly in remote villages where the rate of migration is high and an increasing number of elderly people are deprived of family support. Available data indicate that about one-sixth of elderly people (close to 16 million) in India are living without family support. They constitute a very vulnerable group.

Factors such as these have intensified the need for increasing both the coverage and amount of pensions for the elderly. The efforts of the Ashok Gehlot-led government in Rajasthan reveal that it is possible at the administrative level to very rapidly increase the number of elderly people covered by pensions to a near-universal level. Although the amount of pension was kept low, at Rs 500, the number of persons covered increased very fast within a few months. This gives hope that once there is political will to provide adequate pension to all elderly people, it will be possible to make this a reality quite quickly.

Pension Parishad is a network of about 105 social organisations spread over about 15 states which has been campaigning for a needs-based system of pensions for several years. Its demands have been formulated after extensive discussions at several levels. The Pension Parishad has demanded that a pension equivalent to half the minimum wage, or roughly Rs 2,500 per month, should be paid to all elderly citizens, who at present are not getting any pension or else are getting less than this amount. However, those from very rich households are to be excluded, for which an indication can be provided by income tax data.

The group has argued further that elderly people should be counted as those above 55 years of age in communities involved in strenuous manual labour or those exposed to occupational health hazards, while more generally, elderly people may be identified as those above 60 years of age. The pension should be indexed to inflation so that this is also revised upwards whenever the pension of government officials is revised.

Nikhil Dey, one of the coordinators of the Pension Parishad, says, “At the time of our dharnas we had received support from almost all political parties, whose representatives said at our dharnas that our demands are highly justified. We now appeal to them to take steps towards the actual realisation of these demands. We will continue our campaign and we are going to the Supreme Court for directives to help in securing justice for elderly people.”

Calculations about the budgetary implications have revealed that providing pension of Rs 2,550 per month to about 80% of the population above 60 years age would require annual allocation close Rs 2.6 lakh crore, which can be shared by the Union government and state governments. Raising these resources may not be very easy but it is certainly possible. In case of difficulty, this can also be spread over two years.

As against this need, however, in the Union Budget 2017-18, only Rs 6,126 crore was allocated for the NOAPS, which is actually Rs 4 crore less than the estimate for the previous year. This shows that commitment levels are extremely low for this priority task and drastic change is needed to actually help our elderly citizens.

Bharat Dogra is a freelance journalist who has been involved with several social movements and initiatives.