The Government of Nepal is preparing to raise the eligibility age for elderly allowance from 68 to 70 years. A new action plan has already been approved by the cabinet to implement this change through the upcoming national budget.
Currently, all citizens aged 68 and above receive Rs. 4,000 per month. However, under the new plan, only those who are 70 or older will qualify for this benefit. This move follows the recommendation of the High-Level Economic Reform Commission 2081.
The plan also makes it mandatory to have a national identity card to claim the allowance. The government aims to complete this change within a year.
The Ministry of Finance has also promised to reduce double payments and misuse of the social security system through better tracking. There are no age changes yet for Dalits across Nepal and citizens of the former Karnali Zone, who still receive the allowance from age 60. They currently get Rs. 2,660 per month. Unmarried women aged 60+, divorced, separated, and widows of any age also continue to receive the same amount.
Nepal’s social security spending has seen a sharp rise over the years. In 2073/74, it was just 7.3% of total current expenditure. By 2080/81, it had jumped to 19.67%. The government believes this puts pressure on financial resources.
Last fiscal year, the total mandatory expenses reached Rs. 11.52 trillion, with Rs. 2.26 trillion spent on social security alone. For this year (2081/82), the government has allocated Rs. 2.13 trillion for social protection—11.5% of the entire national budget of Rs. 19.6 trillion.
The age for elderly allowance was previously 70 before being lowered to 68 in fiscal year 2079/80. That change is now being reversed to balance rising costs and improve the system’s sustainability.
