The Employees’ Provident Fund Organisation (EPFO) is set to increase the lowest monthly pension under the Employees’ Pension Scheme (EPS-95) from ₹1,000 to ₹2,500 starting at 2025. This long-awaited move will certainly be a great relief for the more than six million pensioners scattered all over India as it would provide them with a little more money to spend and help them to live better lives if they were once contributors to the EPF system while being employed.
What Is EPS-95 and Who Benefits?
EPS-95 is a pension plan that was established in 1995 for employees that are covered by the EPF Act. To be eligible for this, one must have worked at least for 10 years in an establishment that is EPF-covered. The employers will give 8.33% of the employee’s salary to the pension fund while the government will give support from the budget. The current minimum pension of ₹1,000 has been there for years and has become insufficient for retiree’s basic living expenses, according to the majority of the retirees.
Why the Hike Is Needed
Due to increases in inflation, medical costs, and the necessity for a decent standard of living during retirement, the demand for pension hikes has been steadily increasing. Government representatives and trade unions have consistently pushed for hikes in pension amounts. The proposed minimum pension of ₹2,500 would be more than double the current one, thus, enabling the retirees to cope with their daily expenses in a better way.
Government Response and Legal Backing
The EPFO is considering the proposal seriously and has received several representations from concerned parties. It is possible that the hike will mean that the central government will have to allocate more of the budget to this area and change the EPS rules. Moreover, one of the points that is being considered is the legal support from the Supreme Court and studies on the financial aspect to guarantee the smooth implementation of the project.
Final Thoughts
The new minimum pension of ₹2,500 under EPS-95 is a step forward in the direction of social security for the elderly. It will be tens of millions of the retired people, who are dependent on EPFO for the post-retirement income, whose quality of life will be greatly impacted by the decision. It is advisable that retirees be on the lookout for news through the official EPFO channels and make sure that their service records and pension claims are updated and correct so that the upcoming changes are beneficial to them.
