The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi today approved the operationalisation of the Atal Pension Yojna (APY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY).
Approval of the Cabinet was given to extend funding support for implementing the APY and apprise the Cabinet on operationalisation of the PMJJBY and the PMSBY. Approval was also given to provide Rs. 50 crore per annum for the next 5 years as the Government contribution for publicity / awareness creation related expenditure for PMJJBY and PMSBY.
Under the APY, subscribers would receive a fixed minimum 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 Central Government would also co-contribute 50 percent of the total contribution or Rs. 1000 per annum, whichever is lower, to each eligible subscriber account, for a period of 5 years, that is, from 2015-16 to 2019-20, to those who join the NPS before 31st December, 2015 and who are not members of any statutory social security scheme and who are not Income Tax payers. 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. The minimum age of joining APY is 18 years and maximum age is 40 years. The benefit of fixed minimum pension would be guaranteed by the Government.
Under PMJJBY, annual life insurance of Rs. 2 lakh would be available on the payment of premium of Rs. 330 per annum by the subscribers. The PMJJBY will be made available to people in the age group of 18 to 50 years having a bank account from where the premium would be collected through the facility of “auto-debit”.
Under PMSBY, the risk coverage will be Rs. 2 lakh for accidental death and full disability and Rs. 1 lakh for partial disability. The Scheme will be available to people in the age group 18 to 70 years with a bank account, from where the premium would be collected through the facility of “auto-debit”.
Government expenditure is expected to range between Rs. 2,520 crore and Rs. 10,000 crore on account of Government co-contribution to subscribers of the APY over a period of five years. Further, an expenditure of Rs. 2,000 crore for promotional and developmental activities for enrolment and contribution collection under APY and Rs. 250 crore for publicity, awareness building for PMJJBY and PMSBY is envisaged by the Government, over a period of five years.
It is expected that around two crore subscribers would be enrolled during the current financial year under APY.
It was mentioned in the Budget Speech for 2015-16, that a large proportion of India’s population is without insurance of any kind, that is, health, accidental or life. Further, as the young population of India ages, it is also going to be pension and insurance- less. Therefore, Government has decided to work towards creating a universal social security system for all Indians, specially the poor and the under-privileged, to address longevity risks among workers in the unorganised sector and to encourage workers in the unorganised sector to voluntarily save for their retirement. Such workers constitute 88 percent of the total labour force of 47.29 crore according to the 66th Round of NSSO Survey of 2011-12.