Major pension reform on cards

Rezaul Karim | Published: March 08, 2016 00:00:00 | Updated: February 01, 2018 00:00:00

The government is going to bring about major changes in the existing pension system -- seen fraught with hassles -- to provide better services to its retired employees.
Officials said the system overhauling will be done in the light of best practices prevalent abroad and that a team would go to India for a comprehensive case study.
"As part of the move, the finance minister has started brainstorming as to how the pension-payment system can be made easier and time-befitting," said one official.
He is now preparing a concept paper on the proposed reform initiative in line with the experiences in neighbouring countries, the sources also said.Â Â
A process is underway to send a high-powered official delegation for gathering experiences from the National Pension System of the Indian government, a senior finance ministry official said.
"It is aimed at experimental learning and applying the knowledge in designing reform of government and pro-poor pension system and to understand the policy, strategy, and implementation perspectives of social protection systems of pension system of India," he said.Â Â Â
"An old system of pension payments has been operating in the country. The government has taken initiative to update its pension system," executive director, strengthening public financial management for social protection, Md. Manzoor Alam Bhuiyan, told the FE Monday.
Neighbouring India has completed some key reforms its pension system. But it was also of British period. "As a result, we can gather experiences from the system of the vast South Asian country," he added.
The reform move is mainly to ensure hassle-free pension services to the retired government servants and also their family members, he also said.
An official working on the matter said the government is trying its best for implementing the improved services to its former workforces soon as the finance minister has given commitment for reforming the existing pension system in the current fiscal.Â Â
He, however, said the finance ministry faces problems in pool funds for footing the bill for pension each year for a lack of upgrading the system. The journey to India will be for two weeks, from March 27 to April 08.
Currently, the government pensioners' database is being prepared in the country, with more or less 30,000 former civil servants enrolled so far.
For pension payments, the government has earmarked Tk 115.84 billion in the budget for FY 2015-16. Â
There is no accurate number of these retirees in the country. It is estimated to be over 0.6 million. This is resulting in mismatch between demand for and allocation of budgetary funds in this regard each year. Now, there are around 2.7 million different types of government employees across the country.
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