Imagine hitting your retirement years without a pension to fall back on. No regular paycheck, no savings plan—just a lot of uncertainty. This is the situation for millions of Indians, especially those in the huge unorganised sector. To tackle this issue, the government is looking into a Universal Pension Scheme (UPS), a bold move aimed at reshaping the country’s social security landscape.

 

This new initiative is different from the current pension plans that mainly serve salaried workers. It’s designed to include everyone, from gig economy workers and house help to freelancers. If it gets off the ground, it could provide essential financial support for those who lack a solid plan for their retirement years.

 

So, what exactly is UPS? How does it stand apart from the existing options? And most importantly, can it deliver the kind of financial stability that countless Indians need as they age?

 

In simple terms, UPS is a retirement benefit system available to all citizens, no matter their job situation. Unlike traditional pension plans tied to employment, this universal scheme would also cover self-employed folks, gig workers, and those in the unorganised sector. In many developed countries, similar programs are often funded by the state, guaranteeing a basic level of financial security for retirees.

 

However, India’s proposed scheme is voluntary and requires individuals to contribute to their own pension fund, without any government backing. This is a stark contrast to the state-funded universal pension systems found in places like Denmark, the Netherlands, and New Zealand. Right now, India’s pension landscape is quite fragmented, with various schemes aimed at different groups.

 

1. For salaried workers, the Employees’ Provident Fund Organisation (EPFO) is a must-have savings plan where both the employer and employee chip in for retirement benefits.

 

2. On the flip side, the National Pension System (NPS) is a more flexible option that lets both government and private employees invest in pension funds, offering tax perks and returns linked to the market.

 

3. For those working in the unorganised sector, the Atal Pension Yojana (APY) guarantees a monthly pension between Rs 1,000 and Rs 5,000 after retirement, depending on how much has been contributed over the years.

 

4. Likewise, the Pradhan Mantri Shram Yogi Maandhan (PM-SYM) provides a monthly pension of Rs 3,000 for workers like street vendors, domestic help, and laborers.

 

5. Farmers benefit from the Pradhan Mantri Kisan Maandhan Yojana (PM-KMY), which guarantees a monthly pension of Rs 3,000.

 

6. Even with these options, India still doesn’t have a well-rounded and unified pension system that treats all citizens fairly. The UPS aims to fill this void by introducing a single, voluntary pension model that everyone can access, no matter their job or income level.