As Diwali approaches, lakhs of pensioners under the Employees’ Pension Scheme (EPS), 1995, are awaiting a long-overdue revision in their monthly pension.
The Employees’ Provident Fund Organisation (EPFO) is reportedly considering a hike in the minimum pension amount, which has remained stagnant at ₹1,000 per month since September 2014.
The proposed increase could raise the pension to either ₹2,500 or ₹7,500, though the latter appears less likely due to financial constraints.
The Central Board of Trustees (CBT) of EPFO is scheduled to meet in Bengaluru between October 10 and 11, chaired by Union Labour and Employment Minister Mansukh Mandaviya.
The meeting is expected to address several key issues, including pension revisions, digital platform upgrades, and service enhancements for EPF and EPS account holders.
Background: A Decade Without Revision
EPS-95 was introduced to provide post-retirement financial security to employees in the organized sector.
Living costs have continued to rise over the years.
Despite repeated appeals from trade unions and public representatives, the minimum pension has not been revised in over a decade.
The current amount of ₹1,000 is widely considered inadequate, especially for retirees without additional income sources.
Minister of State for Labour and Employment Shobha Karandlaje acknowledged in Parliament that multiple representations have been received urging an increase in the minimum pension.
The EPS operates as a “Defined Contribution-Defined Benefit” social security scheme, funded through employer contributions (8.33% of wages) and central government support (1.16% of wages, capped at ₹15,000 per month).
Financial Constraints Limit Scope of Pension Hike
While early 2025 saw calls for a hike to ₹7,500, the proposal gained public attention. However, government sources have indicated that such a substantial increase is unlikely.
The EPS fund shows a deficit as per its last actuarial valuation on March 31, 2019. This financial shortfall makes large-scale enhancements challenging.
Despite this, the government continues to provide budgetary support to maintain the ₹1,000 minimum pension.
A more realistic revision to ₹2,500 is now being considered.
This figure aligns with long-standing demands from trade unions and is seen as a manageable increase given current fiscal conditions.
EPFO had previously rejected a High-Level Monitoring Committee’s recommendation to raise the pension to ₹2,000, citing budgetary limitations.
What Pensioners Can Expect
If approved, the hike to ₹2,500 would benefit millions of retirees across India. It would offer modest relief ahead of the festive season.
The decision is expected to be finalized during the October CBT meeting, with announcements likely before Diwali.
In addition to the pension revision, EPFO is expected to unveil upgrades to its digital platform. These enhancements will be introduced under the EPFO 3.0 initiative.
This includes seamless transactions for EPF and EPS accounts, with tech firms like Infosys, TCS, and Wipro shortlisted for implementation.
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