EPFO Alert: Minimum pension in Employee Pension Scheme (EPS) to remain unchanged. Here is why

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Business Standard reported. This decision was communicated to the Central Board of Trustees (CBT) during a meeting on Saturday. According to sources quoted by the Business Daily, a proposal to raise the minimum pension under EPS from ₹1,000 to ₹2,000 per month was sent to the Ministry of Finance based on recommendations from a government-appointed monitoring committee.

However, the Ministry of Finance declined to approve the proposal. Since September 1, 2014, the Government has been providing a minimum pension of ₹1000 per month to pensioners under the Employees’ Pension Scheme (EPS), 1995. The EPS, 1995 operates as a 'Defined Contribution-Defined Benefit' Social Security Scheme.

The Employees’ Pension Fund is funded by contributions from employers at 8.33% of wages and contributions from the Central Government, capped at 1.16% of wages up to ₹15,000 per month. All scheme benefits are financed from these accumulations. According to the Employees’ Provident Fund Organisation's (EPFO) annual report for FY23, there are a total of 7.55 million pensioners.

Of these, 3.64 million receive pensions up to ₹1,000 per month, followed by 1.17 million who receive pensions ranging between ₹1,001 and ₹1,500. Additionally, around 868,000 pensioners receive pensions between ₹1,501 and ₹2,000 per month. Moreover, only 26,769 pensioners receive amounts exceeding ₹5,000 per month, Business Standard reported.