The Old Age Allowance (OAW) or old age pension was introduced in Nepal in 1995/96. Under this scheme, the government provided a monthly payment of Rs. 250 to people above 75; this amount was raised to Rs. 500 per month and the threshold age lowered to 70 in 2009
This old age pension scheme also covers widows, providing an allowance of Rs. 500 per month for widows 60 years and older. Although a paltry sum, for those with no other income, it provides much needed money to buy food, medicine and other essential items. However, this amount is grossly inadequate. Some would say it is a joke! If the government is serious about its responsibility towards the elderly people and its commitment to inclusive Nepal, this old age pension scheme should be improved. With a very high cost of living and double-digit inflation in Nepal, Rs. 500 is a very small amount. The first change that is overdue is the increase in the amount of the allowance—the current monthly allowance is hopelessly inadequate. It should be raised to at least Rs. 2,000 to be meaningful. One might ask, why Rs. 2000? I am in favor of raising it to as high as Rs. 10,000 a month. But this would seriously put a strain on the financial condition of the government. If the government can spend—and it has spent an obscene amount of money for the treatment of political leaders and high-ranking government officials — it should raise the old age allowance. Here it is also illustrative to look at the compensation of CA members.
