Despite the PFRDA’s recommendation to increase the maximum limit under Atal Pension Yojana to Rs 10,000, the Central Government decided not to raise the limit. While replying to a query in the Lok Sabha on Monday (March 13), Dr Bhagwat Karad, Union Minister of State in the Ministry of Finance, revealed the reason why the Government decided not to increase the APY limit.
Currently, APY provides a maximum monthly pension of Rs 5000. According to Dr Karad, increasing the pension amount would have led to an increase in the subscription amount, which is currently in the range of Rs 42 to Rs 1454. Increasing the subscription amount for higher pension would put a further burden on the subscriber. Hence, the Government decided not to raise the APY limit.
“The Atal Pension Yojana (APY) scheme offers a minimum guaranteed pension of Rs. 1000, Rs. 2000, Rs. 3000, Rs.4000 or Rs. 5000 per month based on age of joining and pension amount chosen. Accordingly, per month subscription amount presently varies from Rs. 42 to Rs. 1454,” said Dr Karad.
“The proposal of Pension Fund Regulatory and Development Authority (PFRDA) regarding increase in pension amount under APY was examined. APY scheme offers a minimum guaranteed pension and any increase in pension amount is likely to increase the subscription amount substantially and put further burden on the subscriber. Therefore, it has been decided to continue the scheme with same terms and conditions and not to further increase the pension and subscription amount,” he added.
APY scheme is regulated by the Pension Fund Regulatory and Development Authority (PFRDA). In 2018, the regulator recommended that the Government should increase the maximum limit under the scheme to Rs 10,000. PFRDA had also recommended raising the maximum age bar under the scheme to 50 years and considering automatic enrollment of citizens in the scheme.