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Ahead of budget, economists demand increase in social security pension

New Delhi, December 5, 2022 

Ahead of the Union Budget 2023-24, 51 eminent economists have written to Finance Minister Nirmala Sitharaman and demanded an increase in social security pensions and an adequate provision for maternity benefits.

The signatory of the letter includes Jean Drze (honorary professor, Delhi School of Economics), Pranab Bardhan (professor emeritus of economics, University of California Berkeley), R Nagaraj (professor of economics, IGIDR, Mumbai), Reetika Khera (professor of economics, IIT, Delhi), and Sukhadeo Thorat (professor emeritus, JNU), among others.

"This is a follow-up to our letters of 20 December 2017 and 21 December 2018 (addressed to your predecessor, Shri Arun Jaitley), where we tried to flag two priorities for the next Union Budget: an increase in social security pensions, and adequate provision for maternity benefits.

"Since both proposals were ignored, we are writing again, well in advance of the next Budget, with the same recommendations." the letter said.

According to the letter, the central government's contribution to old-age pensions under the National Old Age Pension Scheme (NOAPS) has stagnated at just Rs 200 per month since 2006.

"This is unfair. It is also a missed opportunity," it said.

The letter said the central government's contribution should be immediately raised to Rs 500 (preferably more) at the very least.

"This requires an additional allocation of Rs 7,560 crore or so, based on the current NOAPS coverage (2.1 crore pensioners)," the letter said, adding that similarly, widow pensions should be raised from Rs 300 per month to Rs 500 at the very least.

As per the letter, this would cost just another Rs 1,560 crore.

The signatory economists also demanded that the Union Budget 2023-24 should provide for full-fledged implementation of maternity entitlements as per NFSA norms.

"This requires at least Rs 8,000 crore.

"Along with this, the illegal restriction of maternity benefits to one child per woman should be removed," they said.

Finance Minister Nirmala Sitharaman will present the 2023-24 Budget in Parliament on February 1, 2023.

[Press Trust of India]

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