Prime Minister Narendra Modi on 9 May 2015 launched Atal Pension Yojana (APY) in Kolkata, West Bengal.
The scheme is intended to enhance old age income security of the working poor and is focused on encouraging and enabling them to join the National Pension System (NPS). It will be operational from 1 June 2015.
Key Features of Atal Pension Yojana (APY)
Operational Framework: It is a Government of India Scheme and is administered by the Pension Fund Regulatory and Development Authority (PFRDA). The institutional architecture of NPS would be utilised to enroll subscribers under scheme.
Eligibility: All citizens in the unorganised sector, who join the NPS administered by the PFRDA and who are not members of any statutory social security scheme are eligible to benefit under the scheme.
The minimum age of joining is 18 years and maximum age is 40 years. All the existing subscribers of Swavalamban Scheme would be automatically migrated to APY, unless they opt out.
It is expected that around two crore subscribers would be enrolled during the financial year 2015-16 under the scheme.
Benefits: The subscribers would receive the fixed pension, as guaranteed by the Union Government, of 1000 rupees per month, 2000 rupees per month, 3000 rupees per month, 4000 rupees per month, 5000 rupees per month, at the age of 60 years, depending on their contributions, which itself would vary on the age of joining the scheme.
The pension would also be available to the spouse on the death of the subscriber and thereafter, the pension corpus would be returned to the nominee.
Funding: The Government would co-contribute 50 percent of the subscriber contribution or 1000 rupees per annum, whichever is lower, for a period of 5 years starting from 2015-16, who join the NPS before 31 December 2015 and who are not Income Tax payers. The government would also reimburse the promotional and development activities including incentive to the contribution collection agencies to encourage people to join the scheme.
The Government expenditure is expected to range between 2520 crore and 10000 crore rupees on account of co-contribution to subscribers of the APY over a period of five years. Further, an expenditure of 2000 crore rupees for promotional and developmental activities for enrolment and contribution collection is allocated for period of five years.
Enrolment agencies: All Points of Presence (Service Providers) and Aggregators under Swavalamban Scheme would enroll subscribers through architecture of NPS.
In India, workers in the unorganized sector constitute 88 percent of the total labour force of 47.29 crore, as per the 66th Round of National Sample Survey Organisation (NSSO) Survey of 2011-12, but do not have any formal pension provision. Hence, in order to address the longevity risks and encourage them to voluntarily save for their retirement the Union Government had launched the Swavalamban Scheme in 2010-11.
However, enrollment under the scheme is not encouraging due to lack of clarity of pension benefits at the age after 60 years. So, in order to address the lacunae in the Swavalamban Scheme the APY was launched.
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When: 9 May 2015