It is concerning that only a small percentage of the elderly population receives pension benefits from the Employees’ Old Age Benefits Institution (EOBI), the country’s only contributing pension programme.
Pakistan is one of the 15 countries in the world where the number of people aged 60 and above is more than 10 million. The number of older people in the country, estimated currently to be 16 million, is predicted to rise to 45 million by 2050. It is concerning that only a small percentage of the elderly population receives pension benefits from the Employees’ Old Age Benefits Institution (EOBI), the country’s only contributing pension programme.
According to the most recent figures provided on the EOBI’s official website, there are 690,306 EOBI beneficiaries, including 447,079 pensioners, 231,497 survivors of deceased pensioners and 11,730 disabled people. The overall number of beneficiaries (690,306) represents only 4.3 percent of the total number of older people in the country, implying that the EOBI benefits only 4.3 percent of the country’s older population. Due to the lack of any pension, a substantial number of older women and men are living in poverty. This is leading to old-age poverty. As the population of the elderly is growing, the issue requires an immediate response.
Pakistan has the world’s ninth largest labour force, according to the government’s annual plan for 2020-21, and it’s growing every year. According to estimates, the country has a labour force of roughly 75 million people, with agriculture leading the way with 44 percent of the workforce; followed by industry with 22 percent; and services with 34 percent. However, according to EOBI figures, there are 9.3 million insured people in the country, accounting for barely 12 percent of the overall workforce. Because there is such a large gap, the government must take steps to expand the EOBI coverage. The government should look into making it easier for companies to register their employees with the EOBI and improving monitoring methods to convince employers to do so.
The objective of any pension system is to support the elderly and to protect them from poverty. Therefore pension adequacy is a very crucial aspect. It is important that the pension amount must be sufficient to cover the pensioner’s fundamental needs. It is very unfortunate that adequacy of the EOBI pension is not up to the mark. EOBI pensioners currently receive a very small amount, Rs 8,500, as monthly pension. With this sum, it is very hard for older people to meet their basic needs of food, clothing and medical expenditures.
The minimum wage has been set at Rs 20,000 per month in the budget for the financial year 2021-22. The EOBI pension, at Rs 8,500, is only 42.5 percent of the country’s minimum wage. These retired workers are entitled to a dignified life. They require a sufficient pension amount to live comfortably.
The government increased the EOBI monthly pension from Rs 6,500 to Rs 8,500 at the end of year 2019. It was announced that this will be increased to Rs 15,000 per month. This promise has yet to be fulfilled.
The government must include the well-being and prosperity of senior citizens in their social protection agenda and programme. It is critical to examine the coverage and adequacy of the EOBI and to implement swift reforms and measures so that a majority of the workers is registered with the EOBI and receives an adequate pension upon retirement.
The writer is an author based in Rawalpindi and can be reached at email@example.com