Old-age pension needs a boost

• Follow

Any government pursuing welfare economics in a country with a large number of poor people ought to take up universal basic income. Even if resource considerations are a hindrance to this policy, it should have an effective old-age pension scheme. Pointing out precisely this need, the Economic Advisory Council to the prime minister has recently recommended that the existing programme be strengthened. While the current amount paid to the beneficiaries of Indira Gandhi National Old-Age Pension Scheme are paid Rs 300 (60-79 years) and Rs 500 (80 years and above), the council has urged the government to raise the monthly amount to Rs 1,500 and Rs 2,500.

The recommendation is appropriate and should be implemented without delay. Senior citizens, especially of the BPL category, have always faced a tough life, uncared for in many families who cannot even afford the basic essentials in life. The hardships have increased manifold especially with the pandemic affecting the income levels of millions of families at the bottom of the financial pyramid. If the government has to present its welfare face, no other vulnerable section perhaps needs it more than the poor elders of the society.

As more and more enlightened technocrats come to rule us, we can expect better targeting of benefits and not a hazy scattering of doles. Nearly 14 crore Indians have passed 60. Obviously, not all of them need the pension. The state has to take the benefit of the financial inclusion process to deliver the pension. If necessary, banking correspondents should visit households and open Jan-Dhan accounts for those on a priority basis.

There seems to be sustainable revenue buoyancy even as the economy is emerging from the impact of the second Covid wave. If direct and indirect tax administration continues to improve with a diminution in leakage, the government should not have a dearth of revenue to ignore this valuable recommendation from its advisors. A welfare mechanism that is not linked to ground realities delivers no welfare at all.