Government of India has received formal representations from trade unions, pensioners’ associations, and public representatives requesting an increase in the minimum monthly pension under the Employees’ Pension Scheme (EPS), 1995.
The current minimum pension stands at ₹1,000 per month, a figure that has remained unchanged since its introduction in September 2014.
While no official decision has been made, the Ministry of Labour and Employment acknowledged the demand in a press release dated 24 July 2025, and confirmed that the matter is under review.
Pension Background: Structure and Funding of EPS-95
EPS-95 is a Defined Contribution–Defined Benefit social security scheme administered by the Employees’ Provident Fund Organisation (EPFO).
It provides retirement benefits to private-sector employees who have contributed to the Employees’ Provident Fund (EPF) for a minimum of 10 years.
The pension fund is built from:
- Employer contributions at 8.33% of wages
- Central government support at 1.16% of wages (up to ₹15,000/month)
All benefits are paid from these accumulations. However, the scheme faces financial stress.
As per the last actuarial valuation dated 31 March 2019, the fund showed a deficit, raising concerns about long-term sustainability.
Despite this, the government continues to provide budgetary support to ensure a minimum pension of ₹1,000/month.
Stakeholder Demands to Hike Minimum Pension and Policy Context
Multiple stakeholders have argued that the current pension amount is insufficient to meet basic living expenses, especially in light of rising inflation and healthcare costs.
The EPS-95 National Agitation Committee and other groups have demanded a hike to ₹7,500 per month, along with the inclusion of Dearness Allowance (DA) indexed to inflation.
Finance Minister Nirmala Sitharaman has reportedly assured representatives that their demands will be reviewed with empathy, though no formal announcement has been made.
Supreme Court Developments and Clarifications
Contrary to some media reports, there has been no Supreme Court ruling mandating a pension hike under EPS-95.
Legal petitions and public interest litigations have been filed over the years concerning the EPS-95 pension structure.
However, the government has not issued any circular approving a revision to the existing pension amount.
The Ministry of Labour and Employment has clarified that the ₹1,000 minimum pension remains in effect, and any future changes will be subject to financial feasibility, policy review, and approval by the Central Board of Trustees (CBT) of EPFO.
Implementation Considerations and Fiscal Impact
If approved, a pension hike would require:
- Additional budgetary allocations from the central government
- Reassessment of employer contribution rates
- Measures to address the actuarial deficit in the pension fund
Experts caution that while the demand is justified, implementation must be fiscally sustainable and actuarially sound to protect long-term viability.
What Pensioners Should Do
Until an official decision is announced, pensioners are advised to:
- Keep KYC and bank details updated in the EPFO portal
- Monitor official EPFO and government notifications
- Avoid relying on unverified reports or speculative claims
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