Home Knowledge Path to Progress...Atal Pension Yojna (APY)

Path to Progress...Atal Pension Yojna (APY)

by Madhavi Mihir Bhuta (National Executive Member, BJP Mahila Morcha)
Jul 07, 2020

Godavaribai, aged 86 came to live in Ratnagiri, coastal town in Maharashtra about 10 years ago. She was widowed at the early age of 35, with a young son aged 12 to fend for.

She had to do something to make a living and bring up her son. Her mother, still hale and hearty, offered to look after her son, so Godavaribai decided to travel to Mumbai in search of a job.

She got a job as a house maid in Mumbai and earned decent money. Way back in the Sixties, earning a few hundreds meant quite a sound earning.
She sent most of her earnings to her mother to nurture her son.

Years flew by, the son completed his education and acquired a job in a nearby bank as a clerk and earned enough to support his own family, but with the expansion of his family his monthly salary became barely sufficient. Godavaribai was ageing but kept working to provide the extra monetary support to her son’s family of four children. He also inherited the house of Godavaribai’s late husband and refurnished it using his mother’s earnings.

Godavaribai pursued her job in spite of her failing health. Later, when she was too old to continue working, at the ripe old age of 76, she decided to call it a day and went back to her village to lead peaceful life with her family.

Her quitting job and returning home meant a stoppage to her earnings and, moreover, her son and his family had to bear her medical and other daily expenses. The son’s family was not prepared to face and handle this changed scenario, hence relations between Godavaribai and her son’s family became somewhat strained.

Godavaribai, with her years piling up and diagnosed with acute TB, had not a penny to spend on her medical treatment. She had never thought about saving a penny for herself as she always believed that she was the mother of a son who would do the needful in her old age.

This is the tale of early 2000, when any kind of life insurance, accident insurance, or pension schemes for the unorganised sector were not prevalent.

In 2012, there were around 487 million workers in Bharat, the second-most after China. Of these, over 90 per cent were employed in the unorganised sector. The unorganised sector’s work force ranged from pushcart vendors to house maids to delivery boys to home based diamond and gem polishing operators.

The organised sector consisted of workers employed by the government, state-owned enterprises, and the private sector employees.

The economic survey of 2018-19, released on the July 4th 2019, states that almost 93 per cent of the total workforce is informal - it belongs to the unorganised sector. We can imagine that with such a huge workforce belonging to the unorganised sector, the labour laws and reforms to protect their well-beings have to be in-force.

Unfortunately, in first few decades post independence, due to lack of proper strategising of their welfare, the informal labourers were left to mercy of goodness of the employers. At the time of independence, Nehru Government proclaimed the status of Socialist Government, but in reality, the non-existence of dedicated planning for the upliftment of such informal workforce, turned out to be the cause of the drudgery they had to face.

When NDA Government came to power in 2014, Hon.Prime Minister envisioned the eminent need of bringing each citizen of the nation under the umbrella of Banking. The path to economic safety leads to progress, through Banking facility.

With the successful implementation of PradhanMantri JanDhan Yojna and huge population embracing and availing  the banking benefits with opening of Zero balance account, a Pension Scheme was passed in Union Budget of 2015-16, by the then Finance Minister Shri. Arun Jaitley.

Hon. Prime Minister Shri. Narendrabhai Modi launched Atal Pension Yojna (APY), a National Pension Scheme on the 9th of May 2015 in Kolkatta, under the Ministry of Finance.

Atal Pension Yojna is a Pension Scheme mainly aimed at the unorganised sector such as Maids, Gardener’s, Delivery boys etc.

The goal of this scheme is to ensure Financial security in the old age and in case of illness, accident or diseases. Private sector employees or the employees working with such an organisation that does not provide them pension benefit, can also apply for the scheme. The eligibility to acquire benefits of the Atal Pension Yojna, the following requirements has to be fulfilled :

Bharatiya citizen belonging to unorganised sector (or in private sector which does not provide Pension benefits) is between the age group of 18 to 60, having valid mobile number and a bank account linked with Aadhar and has a contribution for a minimum of 20 years, becomes entitled for this scheme.

All nationalised banks provide this scheme. APY enrolment can also be done online along with photocopy of Aadhar Card and valid mobile number.

The monthly contribution depends upon the amount of the pension one wants to receive upon the retirement and also the age at which the beneficiary starts contributing.

There is an option of getting a fixed pension of Rs.1000,  Rs.2000, Rs.3000, Rs.4000 or Rs.5000 on attaining an age of 60. Since the contribution is made periodic, the amount is directly debited from the account of beneficiary. The premium can be increased at the beneficiary’s will. Central Government co-contributes 50 % of the total yearly contribution or Rs.1000/- per anum, whichever is lower, for the period of five years in the account of subscribers who join the scheme upto 31st December 2015 and who are not a member of any Statutory Social Scheme and not an Income Tax payer.

In case, the beneficiary defaults payments for Six months, the account of the beneficiary will be frozen and if the default continues for 12 months, the account will be closed and the remaining amount will be paid to the subscriber.

Since independence, Bharat was  ruled by single family for most of the years. Yes, the nation was ruled and not governed, as the Prime Ministership was passed on as heritage. Those who ruled (directly or indirectly) lived in glass house and hardly had connectivity with problems faced by the common man at the grassroots.

Modiji, having witnessed the hardship of huge section of population belonging to informal labourers, was determined to protect their old age with dignity and comfort. Hence, various kinds of Insurance and Pension schemes were implemented by Modiji led Government that changed the lives of each citizens.

Now, no Godavaribai will have to suffer or beg for basic aids in their later life, post retirement.