The Union Cabinet has recently approved the continuation of the Atal Pension Yojana (APY) up to financial year 2030–31, reaffirming the Government of India’s commitment to providing social security and old-age income support, especially to workers in the unorganised sector.

Background of Atal Pension Yojana

The Atal Pension Yojana was launched by the Government of India on 9th May 2015. The scheme aims to encourage voluntary retirement savings among economically weaker sections by offering a defined and guaranteed monthly pension after the age of 60 years.

APY addresses the issue of old-age income insecurity, particularly for workers who do not have access to formal pension systems.

Objectives of the Scheme

• To provide financial security during old age
• To promote long-term savings habits
• To ensure a guaranteed pension for unorganised sector workers
• To reduce dependency on family or government support after retirement

Key Features of Atal Pension Yojana

1. Target Group

• Primarily aimed at workers in the unorganised sector
• Includes labourers, domestic workers, street vendors, and self-employed individuals

2. Eligibility

• Indian citizens aged 18 to 40 years
• From 1st October 2022, individuals who are income tax payers are not eligible to join APY

3. Guaranteed Pension

Subscribers can choose a fixed monthly pension of:

• ₹1,000
• ₹2,000
• ₹3,000
• ₹4,000
• ₹5,000

The pension amount depends on the age of entry and contribution amount.

4. Government Co-Contribution (Initial Phase)

• Applicable to subscribers who joined between 1 June 2015 and 31 March 2016
• Government contributed 50% of the subscriber’s contribution or ₹1,000 per annum, whichever was lower
• Contribution was provided for five years, subject to eligibility conditions

5. Regulatory Authority

• The scheme is administered by the Pension Fund Regulatory and Development Authority (PFRDA)

Exit and Withdrawal Provisions

Exit at Age 60

• Subscriber starts receiving full guaranteed pension

Exit Before Age 60

• Allowed only in exceptional cases, such as:
  • Death of the subscriber
  • Terminal illness

Voluntary Exit

• Subscriber receives only their contribution with accrued interest
• Government co-contribution, if any, is forfeited

Significance of the Cabinet’s Decision

The extension of APY till 2030–31 is significant because:

• It strengthens India’s social security framework
• Provides stability and long-term confidence to subscribers
• Supports financial inclusion and pension coverage
• Aligns with the government’s goal of inclusive growth and welfare economics