February 26, 2025: The government is working on a new 'Universal Pension Scheme' that will be accessible to all Indian citizens, including those in the unorganised sector, sources from the Labour Ministry revealed on Wednesday. This move aims to provide a structured pension option for workers who currently do not have access to government-backed savings schemes.

At present, individuals employed in the unorganised sector—such as construction workers, domestic staff, and gig workers—lack the benefits of large-scale government-run pension schemes. The new initiative seeks to bridge this gap while also extending its coverage to salaried employees and self-employed individuals. Unlike the existing Employee Provident Fund Organisation (EPFO), the new scheme will be purely voluntary, with no financial contributions from the government.

According to sources, the primary objective of the proposed scheme is to streamline and simplify the country’s pension framework. While it may consolidate some of the existing pension initiatives, it will not replace the National Pension Scheme (NPS), which also operates on a voluntary basis. The government aims to create a safe and accessible pension option for all, ensuring that citizens have the opportunity to secure their financial future post-retirement.

Currently, India has several pension schemes catering to specific groups. The Atal Pension Yojana (APY) provides a fixed monthly pension after retirement, while the Pradhan Mantri Shram Yogi Mandhan Yojana (PM-SYM) supports street vendors, domestic workers, and labourers. Additionally, the Pradhan Mantri Kisan Mandhan Yojana offers farmers a pension of ₹3,000 per month upon reaching the age of 60. The introduction of the Universal Pension Scheme is expected to serve as a more comprehensive and inclusive savings option for citizens.

The government is in the process of finalizing the proposal document, and consultations with stakeholders will begin soon. The scheme is expected to provide a structured and reliable savings mechanism for millions of Indians, particularly those who currently lack financial security in their later years.