Supreme Court Ruling and EPFO’s Higher Pension Rollout
The Employees’ Provident Fund Organisation (EPFO) has issued approximately 16,282 pension payment orders under EPS-95 Higher Pension following the Supreme Court’s November 2022 ruling.
The judgment upheld amendments to the EPS, allowing members who were part of the scheme as of September 1, 2014, to contribute 8.33% of their actual salaries, uncapped by the earlier ₹15,000 monthly wage limit.
The ruling also directed the EPFO to accept applications for higher pensions, leading to 17.49 lakh submissions by the December 2023 deadline.
While significant progress has been made, challenges persist. Over 6 lakh applications for higher pension validation are still under examination, and 2.6 lakh forms have been rejected.
The EPFO has revealed that analysis of 38,000 applicants shows a deficit of ₹25 lakh per person on average, leading to an estimated fund depletion of ₹1,86,920 crore if 50% of the eligible post-2014 applicants opt for higher pensions.
Current Status of Applications
Out of the total applications, 3.12 lakh remain pending with employers, leaving 14.37 lakh under the EPFO’s direct purview. This includes 2.7 lakh forms from pensioners who retired before September 1, 2014, and 11.67 lakh from post-2014 employees.
The disparity in processing outcomes is stark: only 4 pension payment orders have been issued to pre-2014 pensioners compared to 16,278 for post-2014 employees. Additionally, 1.91 lakh applications from pre-2014 pensioners have been rejected, significantly higher than the 69,767 rejections among post-2014 employees.
Demand letters specifying additional dues have been sent to 1.19 lakh post-2014 applicants but only to 21 pre-2014 retirees. Processing delays have been further complicated by the need for actuarial analysis to determine the financial impact, as well as limitations for certain exempted establishments whose trust rules cap pension contributions.
Higher Pension Application Status (EPS-95)
| Category | Pensioners (Pre-1.09.2014) | Employees (As of 1.09.2014) | Total |
|---|---|---|---|
| Applications Received | 2,70,582 | 11,66,515 | 14,37,097 |
| Referred for Clarification | 64,815 | 4,02,739 | 4,67,554 |
| Demand Letters Issued | 21 | 1,19,166 | 1,19,187 |
| Forms Rejected | 1,90,585 | 69,767 | 2,60,352 |
| Pension Payment Orders Issued | 4 | 16,278 | 16,282 |
Efforts to Expedite Processing
The EPFO is striving to clear the backlog within three months. To accelerate the process, it is considering engaging retired officials to handle the workload. Applications with complete documentation are being prioritized, and demand letters are being issued to indicate the additional amounts required for higher pensions.
Members can use their EPFO-managed provident fund balances to cover additional dues. If the required amount is unavailable, applicants must pay the shortfall directly or through their employers. The EPFO has also extended deadlines multiple times to accommodate both employers and employees, allowing submissions until December 31, 2023.
Despite the operational and financial challenges, the EPFO’s rollout of higher pensions marks a significant step in addressing members’ long-standing demands. The outcome hinges on timely processing, equitable resolution, and sustainable management of the pension fund to ensure its long-term viability while fulfilling commitments to contributors.
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