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Budget FY19: Private sector employees likely to gain pension scheme

  • Published at 07:41 pm June 6th, 2018

At present, only 5% of the total population working as government employees enjoy pension schemes

Private sector jobholders in the country are going to get some good news in the national budget for 2018-19 fiscal year, the last budget of this government before elections.

According to Finance Ministry sources, the government plans to announce a detailed outline of a private sector pension scheme in the new budget.

Finance Minister AMA Muhith will announce the outline in the budget scheduled to be placed before parliament on Thursday.

Sources said the outline will mainly be a universal pension system that would primarily be introduced in the private sector.

A ministry official told the Dhaka Tribune on Wednesday: “This private sector pension scheme will cover 100,000 beneficiaries on a pilot basis, focusing on three classes of people – lower income savers, voluntary savers, and private sector employees.”

Initially, private sector employees such as ready-made garments workers might be included on the system’s trial run, the official said.

Ministry sources said this pension scheme was first tabled in 2015 with the Cabinet’s approval of the National Social Security Strategy, and a detailed plan focusing on the formulation of the universal pension system.

A year later, on June 2 in 2016, Finance Minister Muhith in his budget speech for FY2016-17 said: “We are considering bringing fundamental changes to our existing pension system. Our plan is to implement an integrated government-run pension system for self-employed people and employees of private organizations.”

Later, on February 2 this year, at a program at the Secretariat, he said everyone in Bangladesh would be brought under a pension system.

“There will be an outline in the next budget to include the 160 million people of this country in that system,” he said.

At present, only 5% of the total population working as government employees enjoy pension schemes, while 8% of the remaining 95% people are employed in the private sector and do not enjoy pension benefits.

Countries such as India, Malaysia, Sweden, Denmark, Netherlands, Turkey, Croatia, Canada, and Australia have the best practices when it comes to pension schemes.