Will minimum EPS-95 pension be hiked this festive season? Govt responds in Parliament

Pensioners in India are looking forward to a long-awaited increase in the minimum monthly pension amount under the Employees' Pension Scheme (EPS-95). The current minimum pension is Rs. 1,000 per month, but trade unions, pensioners' associations and public representatives have been urging the government to raise the amount.


The government has also confirmed that it has received many requests from trade unions and public representatives for an increase in the minimum pension.

What is EPS?

The Employee Pension Scheme (EPS) is a retirement benefit plan introduced by the Indian government in 1995 to provide financial security to employees after they stop working. It is part of the Employees' Provident Fund (EPF) framework. While, EPF serves as a lump sum retirement corpus, EPS provides pension upon retirement. This pension varies depending on the member salary and years of service. The funds in EPS need not be contributed separately.
ET Wealth Online tells you in detail the questions asked by the Members of Parliament on the minimum pension hike and the government's reply on the same.

Also read: Higher pension: These central government employees to get pension hike due to minor salary increase

Questions on minimum pension under EPF-95

Members of Parliament Vaiko and M. Shanmugam asked various questions on minimum pension.
(a) Whether the demand to enhance minimum pension in Employees Pension Scheme (EPS-95) is under consideration of Government for a long time?
(b) If so, by when Government will take a decision, especially in view of mounting pressure from the trade unions and the court judgments?
(c) The constraint in increasing the EPF pension when there are sufficient funds available in the corpus fund and the accumulated unclaimed funds? and
(d) Whether Government would expedite a decision in view of coming festival season?

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The government responded to the questions in Parliament:
Representations have been received from various stakeholders including trade unions and public representatives to increase the minimum pension under the Employees' Pension Scheme (EPS), 1995 from existing Rs. 1000/- per month. The EPS, 1995 is a "Defined Contribution-Defined Benefit" Social Security Scheme. The corpus of the Employees' Pension Fund is made up of (i) contribution by the employer @ 8.33 per cent of wages; and (ii) contribution from Central Government through budgetary support @ 1.16 per cent of wages up to an amount of Rs.15,000/- per month. All benefits under the scheme are paid out of such accumulations. The fund is valued annually as mandated under paragraph 32 of the EPS, 1995 and as per the valuation of the fund as on 31.03.2019, there is an actuarial deficit. However, the Government is providing a minimum pension of Rs. 1000 per month to the pensioners under the EPS, 1995 by providing budgetary support, which is in addition to the budgetary support of 1.16 per cent of wages provided annually towards EPS to Employees' Provident Fund Organisation (EPFO).

Is there any decision expected ahead of the upcoming festive season?

There is no confirmation of a pension hike before the festive season. The government did not commit to a timeline but reiterated that it continues to provide budgetary support to ensure the minimum Rs 1,000 pension.