21% Informal Workers Leave PM Pension Scheme, Inflation, Cost of Living Main Factors

New Delhi: Nearly 21% informal workers have unsubscribed from the Pradhan Mantri Shram Yogi Maan-dhan (PM-SYM), the Union government's pension scheme meant for unorganised workers, in less than six months, the Economic Times reported.

The total subscribers under the scheme fell to 4.43 million on July 11, down 1.19 million from 5.62 million on January 31, as per government data. This has raised questions about the viability of the scheme, the Economic Times report said.

According to experts, high inflation and rising cost of living has increased the workers' difficulties and could be preventing them from contributing to the voluntary pension scheme.

"Stubbornly high prices have raised the actual cost of living, making it difficult for these workers to sustain the burden of monthly contribution under the scheme," labour economist K.R. Shyam Sundar told the Economic Times . "It would not be surprising if these are permanent exits, with workers actually withdrawing their contribution along with the interest earned on it as high prices continue to pinch on their pockets," Sundar added.

The scheme guidelines state that a subscriber will be allowed to withdraw their share of contribution with savings bank interest rate if they exit the scheme in less than 10 years.

However, if a subscriber exits after 10 years or more but before superannuation at the age of 60 years, the beneficiary's share of contribution along with accumulated interest as actually earned by the fund or at the savings bank interest rate, whichever is higher, will be credited to the beneficiary, the report said.

The scheme, launched with the aim of extending social security benefits to unorganised workers, caters to those in the 18-40 age group and earn less than Rs 15,000 per month.

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