Budget Announcements for Swavalamban Scheme

Budget 2010-11

Para 90. To encourage the people from the un-organised sector to voluntarily save for their retirement and to lower the cost of operations of the New Pension Scheme (NPS) for such subscribers, Government will contribute Rs. 1000 per year to each NPS account opened in the year 2010-11. This initiative, “Swavalamban” will be available for persons who join NPS, with a minimum contribution of Rs. 1000 and a maximum contribution of Rs. 12000 per annum during the financial year 2010-11. The scheme will be available for another three years. Accordingly, I am making an allocation of Rs. 100 crore for the year 2010-11. It will benefit about 10 lakh NPS subscribers of the un-organised sector. The scheme will be managed by the interim Pension Fund Regulatory and Development Authority.

Para 91. I also appeal to the State Governments to contribute a similar amount to the scheme and participate in providing social security to the vulnerable sections of the society.”

Budget 2011-12

Para 106 I had announced a co-contributory pension scheme ’Swavalamban’ in the Budget 2010-11. This scheme has been welcomed by the workers in unorganised sector. Over 4 lakh applications have already been received. On the basis of the feedback received, I am relaxing the exit norms whereby a subscriber under Swavalamban will be allowed exit at the age of 50 years instead of 60 years, or a minimum tenure of 20 years, whichever is later. I also propose to extend the benefit of Government contribution from three to five years for all subscribers of Swavalamban who enroll during 2010-11 and 2011-12. An estimated 20 lakh beneficiaries will join the scheme by March 2012.

Swavalamban Scheme

To encourage the people from the unorganised sector to voluntarily save for their retirement and to lower the cost of operations of the New Pension Scheme (NPS) for such subscribers, the Government will contribute Rs. 1000 per year to each NPS account opened in the year 2010-11. This initiative, “Swavalamban” will be available for persons who join NPS, with a minimum contribution of Rs. 1000 and a maximum contribution of Rs. 12000 per annum during a financial year. The then Hon’ble Finance Minister, Shri Pranab Mukherjee has launched the Swavalamban Scheme on 26.09.2010 at Jangipur (West Bengal). The scheme will be managed by the interim Pension Fund Regulatory and Development Authority. The Operational Guidelines on Swavalamban are available on the PFRDA’s website at http://pfrda.org.in. The Swavalamban Scheme was initially announced for three years for the beneficiaries who enroll themselves in 2010-11 has now been extended to five years for the beneficiaries enrolled in 2010-11, 2011-12 and 2012-13. The Scheme operates through 50 Aggregators and 48 PoPs. This scheme is open to those citizens of India who are not part of any pension/provident scheme. In view of the encouraging response to the Scheme, relaxations have been provided in the exit norms of the Scheme, whereby a subscriber under Swavalamban will be allowed exit at 50 years (instead of the existing prescribed age of 60 years) or a minimum tenure of 20 years, whichever is later

The per capital Incentive payable to Aggregators has been revised from Rs.50 to Rs.100/-. Further, the incentive for promotion efforts based on volume has also been revised as per details given hereunder:

S. No. Number of Subscriber under Aggregator Incentive for promotional efforts per accounts (only for new and eligible acquisition during the year)
1 Less than 1 lakh Rs.20
2 From 1 lakh upto 3 lakh Rs.30
3 Over 3 lakh upto 5 lakh Rs.40
4 Over 5 lakh Rs.50