HYDERABAD: The long-felt need for a sound social security measure to low-income groups would soon become a reality in the State with the introduction of a pension scheme for people who enrolled themselves as members of Andhra Pradesh Building and Other Construction Workers Welfare Board (APBOCWWB).

Launch date

On behalf of the State government, the board would shortly sign an agreement with the Pension Fund Regulatory and Development Authority of India to jointly implement a centrally-sponsored pension scheme for people in the age group of 18 – 60 who have low incomes.

The programme would be launched on August 1 or, in case of exigencies, definitely on August 15, a senior government official told The Hindu.

The proposed pension scheme is an offshoot of Union Finance Minister's budget speech on February 28 which promised Centre's contribution of Rs. 1,000 per annum to all workers who became members of New Pension Scheme (NPS-lite). The scheme is an extension of NPS which opened for public from May 2009.

As there were not many takers for NPS since it contained only workers' contribution and no government component at all, the Central government decided to give teeth to the programme in this year's budget, the official said.

Against this background, the State government intervened to mobilise a further Rs. 1,000 per annum as incentive to each beneficiary which would be paid out of the Rs. 400 crore corpus available with the APBOCWWB. The board will, however, chip in only when its nine lakh members, as of now, pooled Rs. 200 per annum.

Moreover, the State government contribution will run only up to 50 years age of members. Its objective was to create a monthly pension of Rs. 1,000 to every member.

The combined participation of Central and State governments as also members' annual contribution at the rate of Rs. 200 for at least 15 years is expected to yield the desired pension of Rs. 1,000 per month after the age of 60 years.