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Relief for the Elderly
(Article covered - Relief for the Elderly (Sumati Kulkarni)
Schemes for children and youth, no doubt, should receive high priority as they are the future of the country and without investment in this human capital, the country will not be able to reap the demographic dividend- an excellent opportunity resulting from India’s younger age structure. At the same time in any planning. Adequate provision has to be made for another sizable (about 9 per cent of population) and rapidly increasing vulnerable group i.e. India’s elderly (60+). As compared to 70.6 million in 2001 and 104 million in 2011, they are expected to cross 173 million in 2026.
Relief to Senior Citizens proposed in the Union Budget 2018, the proposals are :-
Due to these provisions , some senior citizens in the lowest slab will not be required to pay income tax at all, while others are expected to enjoy increased savings. These provisions are also likely to act as incentives for taking larger medical insurance cover and also incentive for keeping more fixed deposits in banks.
Pradhan Mantri Vayavandana Yojana
This scheme was started in May 2017 only for one year but in this budget it is extended upto May 2020. Besides, the Investment limit for this scheme is doubled from the existing 7.5 lakhs to 15 lakhs, Under this scheme, operated by LIC for persons above age 60, on survival of the Pensioner during the policy term of 10 years, pension in arrears (at the end of each period as per mode chosen) shall be payable. On death of the Pensioner during the policy term of 10 years, the Purchase Price shall be refunded to the beneficiary. On survival of the pensioner to the end of the policy term of 10 years, Purchase price along with final pension instalment shall be payable. Though the amount received at maturity from investment in this scheme is taxed, this is an attractive option for senior citizens as it gives assured returns at 8 per cent for 10 years.
Overall Impact-Limited
These provisions, though important for certain sections of the elderly, overall impact is going to be confined to a very small percentage of elderly. Majority of rural elderly come from agricultural households and will not have benefits of income tax provisions. BKPAI survey shows that only 10 per cent rural elderly and 16 per cent urban elderly receive employer’s pension. Nearly 42 per cent rural elderly and 47 per cent urban elderly have no income at all. In fact, what is really relevant for majority of the elderly is Aayushman Yojana - the huge state funded National Health Protection Scheme. It is a general scheme for all BPL families and not specific for the elderly but if successful, it is likely to have significant impact on the elderly. Apart from economic dependency, the vulnerability of the elderly is due to their physical dependency resulting from poor health and partial or complete disability. As per BKPAI survey, more than 50 per cent elderly reported themselves as not having good health. Nearly one fifth reported having poor health. About 13 per cent reported having acute morbidity. About 8 per cent need assistance for at least one activity of daily living. Nearly 60 per cent reported having partial or full vision disability, and about one fourth reported having full or partial memory disability and walking disability. It is heartening to note that the budget has announced the above income of Rs. 50,000/ and above. The above provisions will be relevant only for those few who are at the top of this income category.
Constraints/Limitations (with a special focus on RSBY) There have been certain limitations and problems with the functioning of RSBY (Rashtriya Swasthaya Bima Yojana) which has affected the elderly specifically-
Ultimately, the whole issue boils down to increasing the government expenditure on health and the effective public — private partnership. In spite of these constraints, the attempt made in this budget to bring social sectors, especially the health sector at the centre stage is unprecedented in independent India. This approach will certainly go a long way towards improving the quality of life for the elderly in India.
By: Anupama Sharma ProfileResourcesReport error
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