Union Minister Nirmala Sitharaman Proposes ‘Vatsalya’ Pension Scheme for Minors in Budget 2024-25
New Delhi [India], July 23: A new pension scheme named ‘Vatsalya’ has been proposed for minors by Union Minister for Finance Nirmala Sitharaman in the Union Budget 2024-25 presented in the Parliament. This contributory pension scheme will involve contributions from parents and guardians. Upon reaching adulthood, the plan can be seamlessly converted into a normal National Pension System account.
The Union Minister also announced that the committee reviewing the National Pension System (NPS) has made significant progress. She expressed satisfaction with the constructive approach taken by the Staff Side of the National Council of the Joint Consultative Machinery for Central Government Employees. ‘A solution will be evolved which addresses the relevant issues while maintaining fiscal prudence to protect the common citizens,’ the Minister said in her Budget speech.
Last year, the Finance Ministry formed a committee to evaluate the pension scheme for government employees and suggest necessary changes, considering the current framework. Under the old pension scheme, government employees were entitled to a monthly pension after retirement. The new pension scheme, effective from April 1, 2004, requires employees to contribute a portion of their salaries to the pension fund.
Doubts Revealed
Union Minister -: A Union Minister is a person who is in charge of a specific department in the central government of India. They help make important decisions for the country.
Nirmala Sitharaman -: Nirmala Sitharaman is an important leader in India. She is the Finance Minister, which means she takes care of the country’s money and budget.
Vatsalya -: ‘Vatsalya’ is a new pension scheme proposed for children. A pension scheme is a plan that helps save money for the future.
Minors -: Minors are children who are not yet adults. In India, a person is considered a minor until they turn 18 years old.
Union Budget 2024-25 -: The Union Budget is a plan for how the government will spend its money for the year. The 2024-25 budget is for the financial year starting in 2024 and ending in 2025.
Contributory scheme -: A contributory scheme is a plan where people put in money regularly. In this case, parents and guardians will save money for their children’s future.
National Pension System -: The National Pension System (NPS) is a retirement savings plan in India. It helps people save money for when they are older and stop working.
Fiscal prudence -: Fiscal prudence means being careful and wise with money. It is important for the government to manage its money well to avoid problems.
