Amended bill to be placed in next JS session

The Universal Pension System Bill, aiming to include citizens aged between 18 and 50 in a pension scheme, will be placed in the parliament in its next session with several proposed amendments.

The Parliamentary Standing Committee on Ministry of Finance, tasked with scrutinising the initial bill that was placed in parliament on August 29, recently proposed the amendments in a meeting, officials familiar with the matter said.

The committee proposed that the pension scheme be named as ‘National Pension System’ instead of ‘Universal Pension System’ to ensure the inclusion of people from all sectors of life across the country.

Addressing the standing committee meeting, Senior Finance Secretary Fatima Yasmin said the Awami League government had promised to launch a national pension scheme to ensure a better social safety net for the elderly in its 2008 election manifesto.

Later, in 2020, the government announced that the scheme will be created and a strategy was drafted and placed in parliament to that end.

Scrutiny

Members of the Parliamentary Standing Committee on the Ministry of Finance scrutinised the draft bill on the pension scheme at the recent meeting.  

Speaking at the standing committee meeting, member Harunur Rashid said the universal pension is for a specific class of people, not for everyone. 

He said, “Only those who will pay the premium will be able to come under it. That is not a public scheme.”

As per the bill placed in parliament in August, a five-member National Pension Authority will be formed to regulate the scheme. There will also be a 15-member governing body with the finance minister as its chair.

“The bill needs to be more specific about people from which professions will be members of the authority,” proposed Rashid.

However, Bangladesh Bank Governor Abdur Rouf Talukder said everyone has been included as eligible beneficiaries for the scheme. No one has been left out of it. People from 18-50 years of age can enjoy its facilities. They will start receiving the pension from the age of 60.

One must pay premiums for at least 10 years to get the pension. 

The BB governor said plans are also being considered to bring government employees under the scheme.

Meanwhile, speaking about the formation of the five-member pension authority, Dr Abdus Shahid, member of the standing committee, said if it is a regulatory body, then it should include public representatives as members, because according to the constitution, the public is the owner of the country. 

According to the initial bill, there will be no option to withdraw the money deposited in the pension fund in one go, but 50% of it can be taken out as a loan, which has to be repaid with interest.

The pension deposit will be considered as investment and will be given a tax rebate. And the monthly amount that pensioners will receive will be completely free of income tax.

The government will bear the expenses associated with the pension authority and other related costs. The regulator will invest the money deposited in the fund in accordance with the prescribed guidelines and make efforts to maximise profits.

Speaking on the issue, another member of the committee, Rana Mohammad Sohail said the bill mentions two funds– a pension fund and a pension authority fund.

“From which fund will the loan be taken?” he questioned.

Answering the question, BB Governor Talukder said, “The pension authority will be set up following similar criteria like Bangladesh Economic Zone Authority and Chittagong Port Authority (CPA).

“The authority will be able to take loans from the pension fund.”

He also said the bill states that the board of directors of the pension fund shall approve guidelines for investing the loaned money in government securities, low-risk other securities and profitable infrastructure sectors.

The governing body will also provide necessary advice in this regard from time to time.