1. Implementation Review of Social
Pension Schemes in India
Changqing Sun
South Asia Social Protection
The World Bank

2. About the Review
• Jointly with Ministry of Rural Development, GoI
– Feed into government’s own program review
• Objective
– Review progress in implementation, highlight what has worked
across States, identify challenges, and recommend improvements
• Two phases:
– Phase 1: Rapid State Assessment
• focusing on administration of social pensions and processes in
planning/budgeting, application/sanctioning, fund flows and payment
mechanisms, audit/assurance mechanism, grievance redressal,
monitoring
– Phase 2: Field Assessment on performance on the ground,
through household surveys:
• Information on both outcomes and processes, particularly beneficiary
perceptions of application process and payment systems

3. Background
• National Social Assistance Programme (http://nsap.nic.in/)
– National Old Age Pension (1995)
– Widow Pension (2009)
– Disability Pension (2009)
– National Family Benefit Scheme (1995)
– Annapurna (2000)
• Objective – alleviate chronic poverty through regular
cash transfers to the elderly, widows and disabled
persons (most vulnerable among the poor)
• Ongoing debates
– Universal vs. targeted
– Level of benefit (Rs 300 vs. Rs 2000 or ½ minimum wage)
– Fiscal space vs. priority (is spending 3.4% of GDP on social
pension too high?)
– Implementation model: CSS vs. ACA

4. Eligibility Criteria “Plus”
Eligibility
Criteria
GOI Guideline Andhra Pradesh Bihar Delhi Uttar Pradesh
Old Age
Pensions
1) Age: >=60
years
2) BPL
3) Resident of district
4) Not covered under
other schemes
2b) Family Income <
Rs. 60000 per annum
3) Resident of Delhi for >5
years
3) Resident of state
4) Not covered under
other schemes
Widow
Pension
1) Age: >=40
&<=59 years
2) Widow
3) BPL
1b) Age >=18 years
4) Resident of district
5) Not covered under
other schemes
1b) Age >=18
years
3b) BPL OR non –
BPL & Income
<Rs. 60000 per
annum
1b) Age:18-60 years
3b) Family Income <
Rs. 60000 per annum
4) Resident of Delhi for >5
years
1b) Age: 18-64 years
3b) BPL or Annual Income
<Rs. 25,546 in urban areas.
If non BPL, then Annual
Income< INR 19,884 in
rural areas
Disability
Pension
1) Age : >=18
&<=59 years
2) Severe or
multiple disability
(80% disability)
3) BPL
1b)Age: No limit
2b) 40% disability
4) Resident of district
5)Not covered under
other schemes
1b)Age: No limit
2b) 40% disability
1b) Age: 0 -60 years
2b) 40% disability
3b)Family Income<Rs.
75000 per annum
1b) Age: No limit
2b) 40% disability
3b) BPL OR Income <Rs.
1000 per month

5. Coverage and Expenditure by GoI and States
• Three social pension schemes covered 26 million beneficiaries
for FY2012-13, costing GoI US$ 1.5 billion (0.55% budget). BUT
states expand coverage (some also benefit level) significantly
0
20
40
60
80
100
120
140
160
All India UP Bihar AP Delhi
NSAP-financed pensioners as % of GoI targets
Old Age Pensions Widow Pensions Disability Pensions
0
20
40
60
80
100
Uttar Pradesh Bihar Andhra
Pradesh
Delhi
% pensioners financed by GoI
Old Age Pensions Widow Pensions Disability Pensions

6. Tale of two states
AP
• Pioneered with biometric based
smart card technology for beneficiary
identity and pension payment
• Centralized administration through
functioning MIS
• Viable “banking correspondent”
model for SP & NREGA
Bihar
• Used Post Office exclusively
• Complete paper based processing of
administrative tasks, with no MIS to
support implementation
• Beneficiary list was digitized for
reporting purpose

7. Roles and Responsibilities in AP
GP/Ward Mandal / Municipality District State
Key Player GP Secretary or Ward Councilor;
CSP
Mandal Parishad Development
Officer (MPDO) or Municipality
Commissioner; PDA (TSP) Mandal
Coordinator
DC; PD of DRDA; PDA (TSP) Commissioner RD; CEO SERP
Application &
Identification
(1) GP Secretary or Ward
Councilor identifies eligible
individuals and collects
application
Verification (2) After reviewing applications,
MPDO or Municipality
Commissioner enters eligible
applicant data into SSPS offline
application and upload into SSPS
(3) SERP conducts Six-Steps-
Validation;
(4) SERP adds validated
applicants to pensioner list
or gives reason for rejection
Sanction (5) MPDO provides Sanction Order
to pensioner
(6) TSP enrolls pensioner
Fund Flow and
Cash
Disbursement
(13) CSP disburses cash to
pensioners;
(14) CSP returns undisbursed
cash to PDA MC;
(11) MPDO downloads & prints out
AR and handovers to MC;
(12) MC takes cash and AR &
handovers to CSP
(8) DC approves
Acquaintance Roll and PD
sent FTR;
(10) PDA receives
Acquaintance Roll and fund
released, and credits
pensioner accounts
(7) SERP freezes
Acquaintance Roll for that
month;
(9) CEO SERP releases fund
to PDA
Monitoring &
Social Audit
(15) CSP returns signed/thumb
printed AC to both PDA and
MPDO, with reason for non-
disbursement;
(17) GP Secretary or Ward
Councilor verifies non-
disbursement cases
(16) PDA consolidates cash
disbursement and pension non-
disbursement reason and feeds
data into SSPS;
(18) MPDO modifies/confirms
pensioner status for non-
disbursement cases
PD monitors
implementation
CEO SERP monitors
implementation
Evaluation CEO SERP is responsible

8. Application & Sanction of New Pensions in AP
Applicant- Submits
form with white
ration card, and/or
other documents
Panchayat
Secretary/Bill
Collector- Collects
form
Mandal Parishad
Development Officer
(MPDO) / Municipal
Commissioner (MC)
MPDO/ MC enters
data offline&
uploads to central
server
Six step validation
with ration card
database
Sanction/ Reject
MPDO /MC
synchronize with
central server gets
list
Provides Sanction
order to beneficiary
INDIRAMMA/
Rachabanda-
Collects Form, white
ration card
PDA/ TSP downloads
list of new sanctions
for enrollment
Village/ Ward
meetings with
Sarpanch/ Ward
Councilor

9. Proactive identification’s effect
0
5
10
15
20
25
30
35
40
45
50
2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
Number of Beneficiaries: Target (in lakhs)
Old age Pensions Widow Pensions Disabled Pensions

10. Verification of beneficiaries
• MPDO cross-checks documents for age- proof
and the details on ration card against application
form.
• Six Step Validation at state level
– Stage 1: The data of applicants compared with the
sanitized ration card database and invalid ration
cards are filtered out.
– Stage 2: All duplicate applicants filtered with
ration cards numbers
– Stage 3: Verification of the applicant name against
ration card with software for phonetic
comparison.
– Stage 4: Check for one pensioner per family (No
longer done)
– Stage 5: Applicant`s name is matched with live
pensioners and those with the same name and
fathers name within a GP.
– Stage 6: Applicant`s name compared with names
deleted during Integrated Common Field Survey
(ICFS).
57139 26151
72581
27010
21430
3008
349391
invalid ration card #
duplicate ration card #
name not matched
one OAP per family
duplicate with existing live pensioner
deleted in ICFS
eligible applicants

11. State generates
acquittance monthly
online
Mandal Coordinator
takes list & cash to
CSP
CSP disburses
&marks absentee
pensioners as TM,
PM or dead
Un disbursed cash &
signed acquittance
returned to Mandal
Coordinator
PDA shares
disbursement
details with social
pensions server
MPDO prints 2
copies of
acquittance list
State Nodal Account
(SNA) transfers
funds to PDA
PDA credits
beneficiary accounts
& gives cash to
TSP/MC
MPDO validates TM,
PM or death cases
online after field
verification
Mandal Coordinator
hands over signed
physical acquittance
to MPDO/MC
Payments to beneficiaries
PDA remits
undisbursed amount
to SNA
CSP uploads
disbursement data
to PDA server daily
MPDO keeps
physical copy of
signed acquittance
for audit purpose

12. Actors involved in payment in AP
• PDAs – Paid 2% by SERP
– mostly banks (e.g. Warangal has 8 banks), Post Office has 2.5 districts
• MIS vendor (develop, upgrade and operate)
• TSP – Paid 1.75% by PDA
– IT (hardware, software, connectivity, data) and operation services
(enrollment, cash delivery, HR capacity)
– District Coordinator - Monitors enrollments and disbursements.
– Mandal Coordinator - coordinates enrollment process, collect payment
documentation, manage cash movement from banks to CSP.
• CSP – Payment agent
– Must be SHG member of GP
– Paid by Rs 300 + 2.5 * # of pensioners paid
• Village Organization (V0)
– Safe keeps physical cash for the CSP prior to disbursement

13. 2 filled
Applications, 2
Photos, BPL List,
Voter List,
(Death/ Disability
Certificate)
Application +
Attachments +
RTPS
Application
Number
Applicant RTPS Counter
Application +
Attachments
Application
Number +
Block Register
ID
Block Office
RTPS
Database
Application +
Attachments
Application
Number + Block
Register ID +
SDO Sanction
Number +
Sanction Order
SDO Office
Block
Register by
panchayat
SDO
Register by
Block
Apps +
Supporting
stored
block wise
RTPS Application
Number + SDO
Sanction Number +
Sanction Order
Block Office
Number of Sanctioned
ADSSO
Total number of
sanctioned
pensioners by block
(no details)
Number of beneficiaries
in State
DoSW
Social Pensions Document/Information Flow in Bihar

14. Issues in administration processes in Bihar
Stage On Paper In Practice Gap
Applicant
Application
Filling &
Submission to
BDO
• Submit application in
person to RTPS counter
at block office
• Supporting documents
checked at the time of
submission and receipt
provided
• Application submitted to
mukhiya/ward
member/vikas
mitra/panchayat sachiv
who submits on behalf of
the beneficiary
• Supporting documents (Death
Certificate, BPL list ) not easy
• Need support to fill form at the
RTPS counter
• No support for those unable to
go to the block office in person
• May need to pay for
submission
Panchayat
Sachiv
Verification
• Panchayat Sachiv to
conduct physical
verification before
sanction and for
updation of pension
beneficiary list
• Verification carried out
before submission of
application form
• No procedure in place for
systematic updation of
pension beneficiary list
• Unclear parameters of
verification
• Errors of age in age proof used
• Death certificate not easily
available (10+ years)
BDO
Verification,
Recommendatio
n, Monitoring
(Physical
Verification)
• BDO to receive
application at RTPS
counter, verify
documents and ensure
that Panchayat Sachiv
conducts physical
verification
• Block office receives
documents at the RTPS
counter, sorts by GP and
recommends to SDO
• RTPS: Acknowledgement
receipt in English
• RTPS system only front end, no
system of tracking other than
whether disposed or not.
• No physical verification
undertaken

15. Issues in Bihar (2)
Stage On Paper In Practice Gap
SDO
Sanctioning &
notifying ADSS
of new sanction
• Sanction pension based on
verification already done
• Intimates ADSS, PO
superintendent & BDO of
Sanctioning
• Verification of the
documents multiple
times (by 2 assistants),
• Intimates BDO & ADSS of
sanctioning
• Verification only
involves checking if all
supporting documents
attached
BDO
Intimation to
applicant
• Sanction orders mailed to
beneficiary/available for pick
up at RTPS counter.
• Update RTPS application on
status of application
• Sanctions sent through
the Mukhiya/Panchayat
Sachiv (PS)
• No sanction orders
mailed
• Sends sanction order to
Branch level PO for
account creation
• Creates opportunity
for rent seeking by
letting Mukhiya/PS
collecting sanctions
ADSS
Compilation of
records &
Monitoring
• Compilation of number of
sanctioned pensioners and
reporting to DoSW monthly
• Monitoring of Pensions
• Compilation of number
of sanctioned pensioners
• ADSS not always able
to exact accountability
directly from BDOs and
SDOs. Require
intervention of the
DM.

16. Applicant
BDO : Verification and
Recommendation
SDO: Sanctioning
ADSS: Compiling &
reporting
DoSW: Compiling &
request fund release
State Treasury: Fund
release
Postal Department
Bank Account
CPMGDivisional (head) PO
Sub Post Office Branch
Information
Physical Verification by
Panchayat Sachiv
21 days
(RTPS)
21 days (RTPS)
Monthly
RTPS Receipt Sanction Order
District Aggregate
Aggregate numbers
Application &
Supporting documents
Funds Flow
BDO: Intimation
to applicant
Applicant via
Mukhiya/PS
PO Account
Update RTPS
Pensions ProcessSanctioning

17. Bank/Post Office networks
Coverage of Banks and Post Office in the rural areas
S.No State No of
G.Ps
No of
Bank
Braches
Of which
Rural
Post
Offices
(SO&BO)
Total Bank
Branches/
GPs (%)
Rural Bank
Branches/
GPs (%)
BO & SO
/GPs (%)
1 2 3 4 1/2 1/3 1/4
1 Bihar 8474 5247 2809 8982 62% 33% 106%
2 Uttar
Pradesh
51973 13507 6095 17536 26% 12% 34%
3 Andhra
Pradesh
21695 9020 3090 16130 42% 14% 74%
4 Haryana 6081 3659 1392 2642 60% 23% 43%
Source: Banks include RRBs & Coop Bank; data is as of March 31, 2012 from RBI website; Post office data from website of
India Posts.

18. The proposed cash disbursement model
All pension payments will be made in cash through quarterly panchayat level camps
supervised by the BDO.
1. Funds will be transferred by DoSW from the State Treasury to the district.
2. DM will transfer money from district accounts to BDO
3. BDO withdraws money based on sanctioned accounts
4. Supervisors will make payments in camps with support from Panchayat Sewak
Arrangements for cash payments currently underway in Bihar:
1. Printing of colour-coded passbook for each type of pension
2. Creating a consolidated database of all pension beneficiaries based on records in the
offices of the BDO, SDO and ADSS
3. An example of an online MIS/database being developed in Jehanabad can be viewed
here: www.sapjehanabad.in
The ‘final’ verification of beneficiaries to clean the database will be done at the time of
pension disbursement through shivirs.

19. Lessons learnt
• Proactive identification of beneficiaries works better than
demand based approach due low awareness, difficulty in
obtaining documentary proof, transaction cost of
application, and weak ability to follow up on outcome
• Support for filling applications to reduce rent-seeking and
delays from use of intermediaries; and support for obtaining
documents required
• Cross-verification with key database and use biometric
authentication when feasible
• Robust transactional MIS with central database to support
implementation and to reduce work load
• PDA (banks and/or PO) must maintain service standards
defined clearly and monitored rigorously.
• CSP connected with local community, paid according to
transactions, viable business with multiple programs
(+NREGA)
• Coordination and capacity building

20. Payment mechanisms
Andhra Pradesh Bihar Delhi Haryana Uttar Pradesh
Implementing Entity SPV (SERP) under
RDD
DoSW DoSW DoSW 3 Departments
Mode of payment to
beneficiaries
Bank/ Post Office
account credits; and
cash disbursement by
BC/CSP’s
Cash
disbursement
by BDO’s
Credit to
beneficiary
bank account
thru RBI
Cash
disbursement
by Gram
Sarpanch
Credit to
beneficiary bank
account by
districts
Funds management
Model
Centralized Decentralized
(funds drawn by
BDOs into
dedicated bank
account )
Centralized Decentralized
(funds
transferred to
dedicated
bank account
of GP)
Decentralized
(payment by
districts)
Paying agent BC’s supported by
CSPs
(SHG’s, Post Offices)
Block
Development
Officers
Department of
Social Welfare
Gram
Sarpanch
District SW
Officer
Frequency Monthly Quarterly Quarterly Monthly Six monthly
Digitized beneficiary
database
Yes + integrated
transaction based
system
In process of
development
Yes Yes Yes
Claw-back Yes No No Yes No

21. Task Force on Comprehensive NSAP
• Relaxing eligibility criteria particularly
for widow and disability schemes
• Phased universalization to include all
eligible for benefits under the National
Food Security Act (aims to cover 75% of
rural population and 50% of urban
population)
• Proactive identification of potential
beneficiaries
• Monthly payment using Bank and PO
based systems and beneficiaries need
not to travel
• Transaction based IT solution to cover
all administrative processes and to
interface with fund management
system and that of other partners
0 100 200 300 400 500
FY12-
13
FY13-
14
FY14-
15
FY15-
16
FY16-
17
widow
diabled
old age