Old age pensions to be inflation-linked, made universal news
07 March 2013

The government proposes to link old age pensions with the inflation index similar to the wage rates under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), besides making them universal by doing away with the APL and BPL classifications.

The government also proposes amendments to the pension scheme for widows to make them eligible for pension at 18 years instead of the present age cap of 40 and relax physical disability level to 40 per cent in order to qualify for disability pension instead of the present 80 per cent, rural development minister Jairam Ramesh informed the Rajya Sabha today.

He said the "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," the minister said.

The protesting elderly people are demanding an increase in the minimum pension to Rs2,000 a month from the current Rs200 per month.

As an immediate relief, Jairam said, the government will raise it to Rs300 per month, adding that it may not make any difference.

"I agree that today Rs300 a month is nothing and it should be increased. It should be linked to inflation as in the case of MNREGA. I will speak to the finance minister and the Prime Minister," Ramesh said.

He said the hike would apply to all the three pension schemes for the elderly, widows and the disabled.

At present, the elderly get a measly Rs200 a month while widows and the disabled get Rs300 each every month.

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Old age pensions to be inflation-linked, made universal