How to make the UPS successful?

The recent announcement of the Universal Pension Scheme (UPS) by the Bangladeshi government marks a crucial step towards supporting the elderly population. As the country’s average life expectancy rises to 73 years, the need for an old-age support system becomes increasingly urgent. The implementation of the UPS on August 17, 2023, is promising, but its success hinges on addressing several key factors. Let’s explore how to make the UPS successful in Bangladesh.

How to make the UPS successful?

Introducing the Universal Pension Scheme (UPS) in Bangladesh holds great promise to support the growing elderly population. To ensure its success, a strategic approach is crucial, involving careful considerations such as fiscal sustainability, transparent governance, robust institutional frameworks, and effective fund management.

1. Addressing Financial Constraints: Implementing the Universal Pension Scheme (UPS) faces the challenge of balancing increased government expenditure with limited fiscal space. The government needs to allocate funds for the scheme while managing other financial commitments, including infrastructure projects. A clear plan for funding the UPS, especially in the context of low revenue collection, is essential.

2. Ensuring Accountability and Good Governance: Considering instances of mismanagement in social safety net programs, accountability and good governance are critical. Transparent mechanisms should be put in place to prevent misappropriation of resources. Rigorous oversight and monitoring mechanisms are needed to ensure that the funds are used for their intended purpose and reach the intended beneficiaries.

3. Designing a Robust Institutional Framework: Creating a strong institutional and legal framework for the UPS is crucial. Defining the authority and responsibilities of the pension scheme, as well as the operational modalities, is essential for smooth functioning. Establishing a dedicated authority to manage the scheme and ensuring the quality of services provided to beneficiaries are important aspects to consider.

4. Effective Fund Management: Proper management of the pension fund is a critical factor in the success of the UPS. Learning from successful models in other countries, the fund should be invested in profitable ventures to generate income. However, this requires addressing governance-related challenges within Bangladesh’s banking sector. Institutional reforms and a transparent investment strategy are necessary to ensure a steady income stream for pensioners.

5. Prioritizing Transparency: Transparency is key to gaining public trust and confidence in the UPS. Clear communication about fund investment, profit distribution, operational costs, and updates should be provided to beneficiaries. Implementing a robust supervision and monitoring system will help prevent wastage and ensure the scheme’s integrity. The use of automated systems can enhance transparency and accessibility for pension account holders.

6. Inclusive Beneficiary Identification: Creating a comprehensive and accurate database of eligible beneficiaries is essential. To avoid exclusion and ensure equity, the process of identifying and enrolling pensioners should be transparent, fair, and well-documented. Engaging local communities and civil society organizations can help verify and validate beneficiary information.

7. Adequate Investment Diversification: Diversifying the investment portfolio of the pension fund is crucial to mitigate risks and enhance returns. Instead of relying solely on one type of investment, such as banking, the fund could explore opportunities in various sectors, including stocks, bonds, and real estate. This approach can contribute to sustained growth and stable income for pensioners.

8. Education and Outreach: Creating awareness among the population about the UPS and its benefits is vital. Educational campaigns, workshops, and information sessions can help citizens understand how the scheme works, the importance of contributing, and the long-term benefits. This outreach can promote voluntary participation and debunk misconceptions.

9. Technological Integration: Leveraging technology can streamline administrative processes and enhance the scheme’s efficiency. Developing user-friendly digital platforms for registration, contribution tracking, and benefit disbursement can simplify operations and reduce administrative overhead. Ensuring the security of digital systems and providing training for users is essential.

10. Continuous Review and Adaptation: The UPS should not remain static but evolve over time based on changing demographics, economic conditions, and societal needs. Regular evaluations and adjustments to the scheme’s parameters, investment strategies, and operational procedures are necessary to ensure its relevance and effectiveness in the long run.


The introduction of the Universal Pension Scheme aligns with Bangladesh’s aspirations for socio-economic growth. However, its success depends on meticulous planning and execution. By addressing fiscal challenges, establishing transparent governance practices, designing a robust institutional framework, ensuring effective fund management, learning from global best practices, and embracing technological integration, Bangladesh can create a pension system that supports its aging population while upholding principles of transparency, accountability, and efficiency. The success of the UPS will not only contribute to the welfare of senior citizens but also serve as a milestone on the path toward national development goals.

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