Enhancing Pension Scalability for Wider Social Security

The Economic Survey 2024-25 advocates for expanding pension coverage to ensure more individuals are protected by social security. Despite improvements, only a small portion of the population is currently covered by the National Pension System and Atal Pension Yojana. The survey highlights the need for competitive, low-cost fund management to increase accessibility, particularly for the informal sector.

The Economic Survey 2024-25 has advocated for expanding pension coverage to bring a larger segment of the population under the social security umbrella. Despite advancements, only 5.3% of the population benefits from the National Pension System (NPS) and Atal Pension Yojana (APY) combined.

The survey emphasized the importance of scalability in India's pension framework, noting that competitive and low-cost fund management is critical for increasing coverage, especially in the informal sector. The report suggests the pension system is robust in principle, but practical scalability remains a challenge.

With the NPS being one of the world's most cost-effective models, future pension payments depend on market shifts, easing the government's fiscal pressure. The survey underscores the need for continued accessibility improvements, particularly for younger demographics who may overlook the importance of solid retirement planning.

(With inputs from agencies.)