Old age pension may be linked with inflation index: government

NDTV Profit Desk

07 Mar 2013, 03:26 PM IST

Old age pension is likely to be linked with inflation index on the pattern of MNREGA besides being made universal by doing away with APL and BPL criteria, the government informed the Rajya Sabha on Thursday.

The government is contemplating amendments to other two pension schemes to make widows eligible for the pension at 18 years of age instead of the present age cap at 40 years, and the physically challenged with 40 per cent disability eligible for the pension instead of 80 per cent.

"Government has reached a broad consensus on the issue after two rounds of talks with Pension Parishad. Elderly people from different states are staging dharna at Jantar Mantar for universalisation of pension scheme. The Prime Minister has asked me to talk to them...An agreement is likely in the next three to four months," Rural Development Minister Jairam Ramesh said.

Mr Ramesh was responding to members' concern over peaceful protest by the elderly people, who are demanding an increase in the pension to Rs 2,000 a month from Rs 200 at present.

Informing members that it will be made Rs 300 per month, Mr Ramesh said, "I agree that today Rs 300 a month is nothing and it should be increased. It should be linked to inflation as in case of MNREGA. I will speak to the Finance Minister and Prime Minister.

He said the government was implementing three pension schemes at present - Rs 200 a month for the elderly, Rs 300 a month for widows and Rs 300 a month for the physically challenged - and as a first step all these three should be made Rs 300 a month.

"While the government spent Rs 8,400 crore in 2012-13 on pensions, it plans to spend Rs 9,400 crore in 2013-14," Mr Ramesh said, regretting that barely four or five states like Odisha, Andhra Pradesh and Tamil Nadu were disbursing the pension amount every month while others distributed the same once in seven or eight months.

"This is a very important issue ...pension distribution system needs to be changed," the Rural Development Minister stressed.