Government Pension Scheme APY

The Government of India is extremely concerned about the old age income security of the working poor and is focused on encouraging and enabling them to join the National Pension System (NPS).  To address the longevity risks among the workers in unorganised sector and to encourage the workers in unorganised sector to voluntarily save for their retirement, who constitute 88% of the total labour force of 47.29 crore as per the 66^th Round of NSSO Survey of 2011-12, but do not have any formal pension provision, the Government had started the Swavalamban Scheme in 2010-11. However, coverage under Swavalamban Scheme is inadequate mainly due to lack of clarity of pension benefits at the age after 60.

The Finance Minister has, therefore, announced a new initiative called Atal Pension Yojana (APY) in his Budget Speech for 2015-16. The APY will be focussed on all citizens in the unorganised sector, who join the National Pension System (NPS) administered by the Pension Fund Regulatory and Development Authority (PFRDA) and who are not members of any statutory social security scheme. Under the APY, the subscribers would receive the fixed pension of    Rs. 1000 per month, Rs. 2000 per month, Rs. 3000 per month, Rs. 4000 per month, Rs. 5000 per month, at the age of 60 years, depending on their contributions, which itself would vary on the age of joining the APY. The minimum age of joining APY is 18 years and maximum age is 40 years. Therefore, minimum period of contribution by the subscriber under APY would be 20 years or more. The benefit of fixed pension would be guaranteed by the Government. The Central Government would also co-contribute 50% of the subscriber’s contribution or Rs. 1000 per annum, whichever is lower, to each eligible subscriber account, for a period of 5 years, i.e., from 2015-16 to      2019-20, who join the NPS before 31^st December, 2015 and who are not income tax payers. The APY would be launched from 1^st June, 2015. The existing subscribers of Swavalamban Scheme would be automatically migrated to APY, unless they opt out.

Benefit of APY:   Fixed pension for the subscribers ranging between Rs. 1000 to Rs. 5000, if he joins and contributes between the age of 18 years and 40 years. The contribution levels would vary and would be low if subscriber joins early and increase if he joins late.

Eligibility for APY:       Atal Pension Yojana (APY) is open to all bank account holders who are not members of any statutory social security scheme. 

Age of joining and contribution period:   The minimum age of joining APY is 18 years and maximum age is 40 years. Therefore, minimum period of contribution by the subscriber under APY would be 20 years or more.

Focus of APY:     Mainly targeted at unorganised sector workers.

Enrolment and Subscriber Payment:       All bank account holders under the eligible category may join APY with auto-debit facility to accounts, leading to reduction in contribution collection charges.

Enrolment agencies:    All Points of Presence (Service Providers) and Aggregators under Swavalamban Scheme would enrol subscribers through architecture of National Pension System.  

Operational Framework of APY:   It is Government of India Scheme, which is administered by the Pension Fund Regulatory and Development Authority. The Institutional Architecture of NPS would be utilised to enrol subscribers under APY.

Funding of APY: Government would provide (i) fixed pension guarantee for the subscribers; (ii) would co-contribute 50% of the subscriber contribution or Rs. 1000 per annum, whichever is lower, to eligible subscribers; and (iii) would also reimburse the promotional and development activities including incentive to the contribution collection agencies to encourage people to join the APY.

Age of Joining, Contribution Levels, Fixed Monthly Pension and Return of Corpus to the nominee of subscribers

The Table of contribution levels, fixed monthly pension to subscribers and his spouse and return of corpus to nominees of subscribers and the contribution period is given below. For example, to get a fixed monthly pension between   Rs. 1,000 per month and Rs. 5,000 per month, the subscriber has to contribute on monthly basis between Rs. 42 and Rs. 210, if he joins at the age of 18 years. For the same fixed pension levels, the contribution would range between        Rs. 291 and Rs. 1,454, if the subscriber joins at the age of 40 years. 

Central Government Health Scheme For Senior Citizens

        

Senior citizens and retired personnel who have worked in Central Government bodies are assured of their health care needs through the Central Government Health Scheme or CGHS. This scheme for pensioners provides medical assistance to retired central government officials along with their dependents, freedom fighters and widows of government officials. The CGHS Scheme also covers Delhi police personnel, retired judges of the Supreme Court, Parliament secretaries and their families.

Moreover, along with Ex–Governors and Ex–Vice Presidents of India, accredited journalists are also eligible to be covered under the Central Government’s Health Scheme. The Central Government Health Scheme initially started functioning in Delhi. After a few years, it spread to cities such as Allahabad, Ahmedabad, Bangalore, Mumbai, Chennai, Kolkata, Hyderabad, Jaipur and Patna.

The Central Government Health Scheme offers health services through Allopathic and Homeopathic systems as well as through traditional Indian forms of medicine such as Ayurveda, Unani, Yoga and Siddha. These medical facilities are provided through dispensaries and polyclinics. Chief medical officers and medical officers operate these dispensaries and are responsible for the smooth functioning of the scheme.

The main components of the scheme are dispensary services including domiciliary care, specialist consultation facilities, X–ray, Electro Cardiogram (ECG), laboratory testing, hospitalization, purchase and distribution of medicines and provision of health education.

Senior citizen pension scheme in India: 10 things to know about Pradhan Mantri Vaya Vandana Yojana

The Pradhan Mantri Vaya Vandana Yojana is a pension scheme announced by the Government of India exclusively fo senior citizens, it will be available from 4th May, 2017 to 3rd May,2018.
One can subscribe to PMVVY Pension Scheme offline as well as online through the Life Insurance Corporation of India.

Influenced by the success and popularity of Varishtha Pension Bima Yojana 2003 and Varishtha Pension Bima Yojana 2014 schemes and to protect elderly people aged 60 years and above in the falling interest regime, the Modi government recently announced the launch of a simplified scheme of assured pension, called Pradhan Mantri Vaya Vandana Yojana (PMVVY). The scheme is currently being implemented through the Life Insurance Corporation (LIC) of India and was formally launched by Finance Minister Arun Jaitley in New Delhi recently.

As per the scheme, on payment of an initial lump sum amount ranging from a minimum purchase price of Rs 1,50,000 for a minimum pension of Rs 1000 per month to a maximum purchase price of Rs 7,50,000 for a maximum pension of Rs 5,000 per month, subscribers will get an assured pension based on a guaranteed rate of return of 8% per annum, payable monthly.

Here are 10 things to know about the scheme:

1. The Pradhan Mantri Vaya Vandana Yojana is a pension scheme announced by the Government of India exclusively for senior citizens. It will be available from 4th May, 2017 to 3rd May, 2018.

2. One can subscribe to the PMVVY Pension Scheme offline as well as online through the Life Insurance Corporation of India.

3. PMVVY Pension Scheme provides an assured return of 8% p.a. payable monthly (equivalent to 8.30% p.a. effective) for 10 years.

4. Pension is payable at the end of each period, during policy term of 10 years, on monthly/ quarterly/ half-yearly/ yearly basis as chosen by the pensioner.

5. Death Benefit: On the death of the pensioner during the policy term of 10 years, the purchase price shall be refunded to the beneficiary.

6. Maturity Benefit: On survival of the pensioner to the end of the policy term of 10 years, purchase price along with final pension installment shall be payable.

7. Eligibility Conditions and Other Restrictions:

Minimum Entry Age: 60 years (completed)

Maximum Entry Age: No limit

Policy Term: 10 years

Minimum Pension: Rs 1,000 per month
Rs 3,000 per quarter
Rs 6,000 per half year
Rs12,000 per annum

Maximum Pension: Rs 5,000 per month
Rs 15,000 per quarter
Rs 30,000 per half year
Rs 60,000 per annum

8. Payment of Purchase Price

The scheme can be purchased by payment of a lump sum purchase price. The pensioner has an option to choose either the amount of pension or the purchase price.

The minimum and maximum purchase price under different modes of pension will be as under:

Mode of Pension  Minimum Purchase Price  Maximum Purchase Price

Yearly	Rs. 1,44,578/-	Rs. 7,22,892/-
Half-yearly	Rs. 1,47,601/-	Rs. 7,38,007/-
Quarterly	Rs. 1,49,068/-	Rs. 7,45,342/-
Monthly	Rs. 1,50,000/-	Rs. 7,50,000/-

9. Loan: Loan facility is available after completion of 3 policy years. The maximum loan that can be granted shall be 75% of the purchase price.

The rate of interest to be charged for loan amount shall be determined at periodic intervals. For the loan sanctioned in Financial Year 2016-17, the applicable interest rate is 10% p.a. payable half-yearly for the entire term of the loan.

Loan interest will be recovered from pension amount payable under the policy. The loan interest will accrue as per the frequency of pension payment under the policy and it will be due on the due date of pension. However, the loan outstanding shall be recovered from the claim proceeds at the time of exit.

10. Taxes: Statutory Taxes, if any, imposed on this plan by the Government of India or any other constitutional Tax Authority of India shall be as per the tax laws and the rate of tax as applicable from time to time. The amount of tax paid shall not be considered for the calculation of benefits payable under the plan.

Welfare Schemes for BPL Senior Citizens

There are several welfare schemes for all Below Poverty Line Senior Citizens. The procedure for inclusion of name in the category of Below Poverty Line is very cumbersome. Planning Commission of India vide their letter dt 4-9-08 have advised  that this is done as per Expert Group Method from the large sample survey data on house hold consumer expenditure conducted by the National Sample Survey Organization using the Consumer Price Index of Agricultural Labourers for rural poverty lines and Consumer Index for Industrial Workers for urban poverty lines. All-India poverty line for 2004-05 on the basis of expenditure-consumption data collected from 30 day recall period for all items work out to Rs 356.30 for rural & Rs 538.60 for urban poor. Each State has different figures and all-India figures are weighted average of the state-wise ratios.

Indira Gandhi National Old Age Pension (IGNOAPS): This Pension is now granted to all Senior Citizens of 65 & above belonging to a house hold below the poverty line and not limited to destitutes only, as earlier. Revised Scheme is formally launched on 19-11-07 by Prime Minister. The contribution of Central Government is Rs 200 per beneficiary p.m. and minimum Rs 200 from the State. Some States are giving more. Pension is to be credited, where feasible, in to a Post Office or Public Sector Bank account of the beneficiary for 3 months with permission to withdraw every month only one month’s pension.

Sanjay Gandhi Niradhar Anudan Yojna of Maharashtra: The destitute Senior Citizens under 65 shall get Rs 500 p. m., if family income is less than Rs 21000 p.a. If there is more than one beneficiary, the amount shall be Rs 750 p.m. The beneficiary has to apply in prescribed form with certificates for age, income, residential proof for 15 years, not staying in any Vrudhashram and not getting any monthly allowance through any other scheme etc and for being destitute.

Under the revised scheme of IGNOAPS, 1.6 crore Senior Citizens shall be getting benefit. 30% of Senior Citizens are below poverty line and as such about 3 crore are required to be covered under this scheme. The present age limit from 65 should be reduced to 60 and condition of inclusion in list of families below poverty line must be removed.

Indira Awaas Yojna: This scheme was introduced in 1985-86 and provides houses free of cost to below poverty line BPL S C/S T families(40%), physically & mentally challenged(3%) and non

S C /S T BPL house holds staying in rural areas. This is given for new houses as well as conversion of kucha houses in to pucca ones. Cost of the new house is limited to Rs 35000 in plain areas and Rs 38500 in hilly/difficult areas and for conversion Rs 10000 to be financed by Central and State Governments in ratio of 75/25.

Swarnajayanti Gram Swarozgar Yojna: Introduced since April, 99, this scheme provides sustainable income to Rural Poor and BPL families. Under this scheme, credit-cum-subsidy is provided for self-employment, skill development etc. It covers all aspects of Self-Employment like organization of self help groups, training, credit technology, infrastructure & marketing. 4-5 Activities are earmarked for a particular Block with approval of Panchayat Samiti. This is financed in ratio of 75/25 by Centre & state.

Jawahar Gram Samrudhi Yojna: This is the restructured, streamlined & comprehensive version of erstwhile Jawahar Rozgar Yojna, designed to improve quality of life of rural BPL poor. Under this scheme, a demand driven community village infrastructure including durable assets at the village level are created to enable poor to increase the opportunities for sustained employment and generation of supplementary employments.

National Family Benefit Scheme (NFBS): Under this Scheme, Rs 10000 is given to a BPL family on the death of a primary bread winner between the ages of 18-64 years. This amount should be increased considerably.

In addition to above, all BPL Senior Citizens are entitled for many other facilities/benefits notified separately for all Senior Citizens in general.