Government's Finance Division races for shaping National Pension Authority under top-level push and eliciting public opinion in this regard ends tomorrow (Tuesday).
"Prime Minister Sheikh Hasina has instructed the division under the finance ministry to have the law enacted on an urgent basis," says an official of the Ministry of Finance.
The division uploaded the draft act on its website few weeks back, after the decision was made by the government for the benefit of a vast multitude of the population outside the post-retirement pension system in government services.
The long-awaited universal pension scheme, one of the pledges of the ruling party's 2008 election manifesto, will be executed under the Authority.
Any citizen aged between 18 and 50, including expatriate Bangladeshis, can enjoy the facility. Ministry people say opinions from all stakeholders will be solicited in preparing the draft law.
The Authority will consist of one executive chairman and four members. There will be 15-member governing body. The governing body will consist of the Governor of Bangladesh Bank, secretaries of Finance Division and Financial Institutions Division and so.
The fund for the pension scheme will mainly come from government grants and subscriptions of people who will enroll with the Authority.
A beneficiary will be eligible for the scheme after paying installments for at least 10 years in a row.
For each citizen, a separate pension account will be created. As a result, the account will remain unchanged even if a beneficiary changes his or her job.
There will be a minimum amount of monthly subscription and the beneficiary will be able to pay quarterly or yearly. Even they can submit the subscription in advance.
There will be no option for a one-time withdrawal of the deposited money at any point of time. However, through an application, a beneficiary can take a maximum of 50-per cent loan against the deposited money, which must be paid back with interest.
If a beneficiary dies before the age of 75, then the benefit will be given to the nominees up to 75 years. If he/she survives, they will get the pension until death.
The installment for pension will be considered investment and tax-rebated while the monthly pension will remain out of income tax.
The pension authority will invest the amount deposited with the fund as per guidelines (in ensuring maximum financial returns).
The World Bank provided technical assistance to the initiative in the light of the best practices from other countries such as India, Malaysia, Sweden and Australia.
One of the former IDRA chairmen may be chosen for the post of the would-be Authority, according to a section of people at the Finance Division.
The Authority act however needs to be approved from the Cabinet before placing the Parliament for final approval.
Finance division said they want to place the act in the Parliament during budget session.
The Authority can borrow fund by taking prior approval from the government.
The headquarters of the Authority will in Dhaka but later it will be setting its offices in others parts of the country.
The scheduled banks will serve as banker of the Authority.
jasimharoon@yahoo.com