Nearly 99% of RMG workers uninterested in Universal Pension Scheme: Survey

Highlights:

• Only 1.3% of workers have so far enrolled in UPS
• Main reason for lack of interest is financial constraints
• 70% of workers are unwilling due to lack of trust 
• 6.7% concerns over its long-term sustainability
• 2.7% of workers were unaware of the scheme

A recent survey reveals that nearly 99% of readymade garment workers are uninterested in the Universal Pension Scheme (UPS), with only 1.3% having enrolled in the scheme introduced in August 2023.

The study identified financial constraints as the main barrier to participation, with 90.6% of workers citing this reason.

Also, 6.7% expressed concerns over the scheme's long-term sustainability, while 2.7% were unaware of the UPS.

Md Monirul Islam, deputy director of the Bangladesh Institute of Labour Studies (BILS), presented the study's findings at a roundtable held today at Sromo Bhavan in Dhaka. The research was based on interviews with 200 garment workers.

With support from the Netherlands-based organisation Mondiaal FNV, BILS is implementing a project focused on ensuring decent work in the RMG sector through social dialogue.

As part of this initiative, BILS conducted a study between September and December 2024 titled "Universal Pension Scheme: Exploring Potential Scopes for RMG Workers' Social Protection in Bangladesh."

The government introduced four types of Universal Pension Schemes, including the Progoti scheme, which allows RMG workers to participate. This scheme requires equal contributions from both workers and employers, each covering 50% of the cost.

The study's primary objectives were to assess the UPS in Bangladesh, analyse its potential benefits, structure, and mechanisms for RMG workers' social protection, and identify existing gaps.

It also reviewed national and international policies, offering best practices for employer contributions to workers' social protection.

Based on these findings, BILS proposed a model UPS tailored to the needs of RMG workers and offered recommendations for sustainable measures.

At the roundtable, Razequzzman Ratan, member of the Labour Reform Commission (LRC) and the Social Protection for Workers Technical Committee, noted that financial capacity is a major issue, with workers struggling to make ends meet and having little time to plan for the future.

"Successful implementation of the scheme could generate an annual fund of Tk4,048 crore," he added.

Advocate AKM Nasim, a member of the LRC and the Law and Policy Related Committee, emphasised the need for transparency in the management process, warning that without it, workers would not benefit, and only fund managers would.

He also raised concerns about workers' willingness to contribute, pointing out that some may have to give up about one-fifth of their wages.

He suggested starting the scheme with contributions from the government and employers to build workers' confidence.

Abul Kalam Azad, joint secretary of the Bangladesh Trade Union Centre (UTC), questioned how workers could trust employers when many of them are becoming bank defaulters. He highlighted the fundamental issue of trust.

Saidur Rahman, deputy secretary of the Ministry of Labour and Employment, pointed out that job insecurity in Bangladesh makes UPS a potential solution to this problem.

He stressed the need to support efforts to make the scheme more popular among workers.

Sakeun Nahar Begum, former additional secretary of the Ministry of Labour and Employment, revealed that over 70% of workers are unwilling to participate due to a lack of trust.

She questioned whether the results of the study truly reflected government findings and called for identifying and addressing gaps in future initiatives.

She also referred to an EU fund meant for RMG workers' social protection after the COVID-19 pandemic that had gone unused due to a lack of proper documentation.