The Universal Pension Scheme is an opportune and pro-people move of the government for an inclusive and sustainable social safety net for greater socio-economic development, said Dhaka Chamber of Commerce and Industry (DCCI) President Md Sameer Sattar.
This move will create a new era in the economic history of Bangladesh, read a press release issued by the trade body on Sunday.
The pension scheme offers four types of people-friendly packages, including “Pragati,” “Surokkha,” “Samata” and “Prabashi,” targeting different communities especially private sector employees, NRBs, informal sector and low-income group of individuals.
This scheme can also bring in an almost large number of people of the society under its net. The option of a 50 per cent contribution by the government to the insolvent depositors under the “Samata” scheme is also a remarkable move.
DCCI President Sattar believes, in the given global economic meltdown and fiscal austerity, the pension scheme will augment the financial flow in the economy. This scheme is expected to benefit vulnerable citizens with social security reducing poverty and social safety costs in the national budget in future.
He finds this initiative result-oriented and rewarding not only for the mass welfare but also for the best interests of the private sector.
Sattar feels that this robust scheme is expected to rationalise the public sector bank borrowing and make new financing streams to meet the evolving fiscal needs of the government.
It may also help smoothen the private sector credit flow and reduce foreign borrowing to some extent resulting in a hike of the investment to GDP ratio. Alongside, this may also help to make the cost of fund for the private sector very competitive among different financing options.
This scheme is also likely to support the huge number of employees working in the large local conglomerates to MSMEs in the private sector for employment retention, productivity of employees and fiscal safety in their old age through the “Pragati” scheme.
Many developed and developing economies like the Netherlands, Denmark, Germany, Australia, India, Canada, Iceland and Switzerland have meanwhile successfully implemented this sort of scheme to safeguard the welfare of their mass people.
Replication of operational and safety learning from these countries may help the new scheme to perform as the game changer of our much-needed economic transformation, the release added.
Since this pension scheme is imperative to elevate the income of people for an inclusive economy, the DCCI puts emphasis on competitive and secure return for its depositors, good governance and management of this public fund to attract people and accelerate this timely scheme in the long run.