November 28, 2018, Kathmandu, Nepal
The Government of Nepal has passed the Social Security Regulation 2075 using the right conferred under section 69 of the Social Security Act 2074. With the issue of regulation, the implementation of Social Security Scheme visualized in the Act is expected to speed up.
Prime minister launched the scheme and said,"After the implementation of the scheme, workers will not have to worry about their old age as the contribution from their productive years will benefit them in the later part of their life". Further he added that people of all ages and categories would be included in the scheme and no one would be excluded, guaranteeing security to all.
As per law, both employers and employees will have to mandatorily deposit their installment for the scheme and it is applicable for all types of workers. The scheme is in accordance with the Contribution-based Social Security Regulation.
Under the new law, all private employees of Nepal are mandated to contribute 11 % of their basic salary to the social security fund, while employers will add 20 % of the employee’s basic salary. All together an amount equivalent to 31% of the workers' basic monthly salary has to be deposited in the Social Security Fund.
The contribution of 31% will be utilized toward various schemes as under;
1 % will go for medical treatment, health protection and maternity scheme;
1.40 % for accidents and disability plan;
0.27 % for dependent family plan; and
28.33 % for pension or old-age security scheme.
Furthermore, the retirement pension will be provided to workers aged over 60 who have contributed to the fund for at least 15 years.
Along with workers, their spouse, children and parents can also access the facilities in case of the contributor’s death. Deceased worker’s spouse will get a monthly pension equivalent to 60 percent of the worker’s basic salary for lifetime. If a worker dies after paying the premium, the children will get 40 percent of the parent’s monthly salary till the age of 18 as an educational assistance. If the deceased worker does not have a spouse or children, the parents will get 60 percent of the worker’s monthly salary until they survive.
