The National Old Age Pension Scheme (NOAPS) is likely to be re-launched soon as a new scheme and extended to cover all above 65 years and belonging to below poverty line (BPL) households. This would increase the reach of the scheme to about 157 lakh from the current level of around 87 lakh. The extension of the scheme is estimated to cost the Centre about Rs 3,768 crore per year. The Centre would contribute Rs 200 per person.
However, with the expanded coverage of NOAPS, the government might discontinue the Annapurna Yojana, which at present provides 10 kg of cereals free to aged destitute. The benefits under this scheme are typically given to persons who should be covered under the NOAPS but are not covered because NOAPS has a ceiling.
The cost of existing NOAPS and Annapurna Yojana is Rs 2,280 crore. The additional cost to the Centre for the proposed extension of NOAPS would be Rs 1,488 crore per year. The Centre would contribute 50% of the cost for the old age pension scheme and the states would bear the remaining the cost.
The states are likely to have the option of continuing with the present schemes of NOAPS and Annapurna Yojana, or switching to the new system of expanded NOAPS.
This Planning Commission?s proposal has been sent to the finance ministry for consideration and would form part of the Unorganised Sector Workers Social Security Bill, 2007 to be introduced in the forthcoming session of Parliament.
The commission, which reworked its earlier proposal keeping in mind the resource constraints, said for purposes of operationalising the scheme, the total number of persons eligible in each state should not exceed the BPL estimate of the Commission. The panel added the scheme should not be based on the poverty estimates of the states as they follow different methods and yield much larger numbers.