Finance minister Arun Jaitley proposed a universal social security scheme for all Indians in his budget speech on Saturday, offering subsidised insurance and pensions targeted especially at the poor, underprivileged and elderly.
Buoyed by India’s sunny fiscal climate, Jaitley laid out a safety net with accidental death insurance of Rs 2 lakh for a premium of just one rupee a month.
“A large proportion of India’s population is without insurance of any kind - health, accidental or life is worrying, as our young population ages, it is also going to be pension-less,” he said, announcing the Pradhan Mantri Suraksha Bima Yojana
The government also plans to set up a basic pension scheme, the Atal Pension Yojana, for the millions of Indians unable to put money aside for their old age, Jaitley said.
“To encourage people to join this scheme, the government will contribute 50% of the beneficiaries’ premium limited to 1000 each year, for five years, in the new accounts opened before 31st December, 2015,” Jaitley said.
The minister announced the Pradhan Mantri Jeevan Jyoti Beema Yojana – an insurance plan covering not just accidental but also natural death – of Rs 2 lakh at a premium of Rs 330 per year for the 18-50 age group.
Based on a new GDP formula, India’s economy is growing at a faster rate than previously thought, but many ordinary Indians are yet to feel the benefit.
The government has also decided to set up a Senior Citizens’ Welfare Fund, which will derive capital from a corpus set up with unclaimed deposits in EPF and PPF. Those among the elderly who are physically challenged will get assistance in the form physical aids and equipment.