Employee Unions Demand Higher EPS Pension, Government Doesn't Announce Raise; EPS 2026 Replaces 1995 Scheme
نظرة سريعة
- Employee unions in India demand an increase in the minimum Employees' Pension Scheme (EPS) amount from Rs 1,000 to Rs 7,500.
- The government, through Minister Shobha Karandlaje, did not announce any raise, citing fund sustainability.
- Meanwhile, the new EPS 2026 scheme has replaced EPS 1995, introducing faster claim settlements and higher interest, while pension calculation formulas remain unchanged.
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لماذا يهم
Employee unions have long demanded an increase in the minimum EPS amount from Rs 1,000 to Rs 7,500, citing the inadequacy of current pensions for a dignified life for elderly workers.
Many employee unions across the country have long been demanding increasing the minimum Employees’ Pension Scheme (EPS) amount from Rs 1,000 to Rs 7,500. The government, when asked if it has plans to increase the minimum EPS pension amount, however, didn’t announce any raise.
Replying to a question asked in Lok Sabha this week, Shobha Karandlaje, Minister of State for Labour and Employment, said that the government is committed to ensuring robust social security coverage to members of EPFO schemes while taking into consideration the sustainability of the fund and future liabilities.
Will the government increase the minimum EPS pension amount?
The issue was raised by Bhausaheb Rajaram Wakchaure in Parliament amid the long-standing demand by the EPS-95 National Agitation Committee to increase the minimum pension to Rs 7,500 per month along with dearness allowance (DA).
However, the government did not announce any decision on raising the minimum pension from the existing Rs 1,000 per month or specify a timeline for doing so.
Government outlines how EPS pension fund is financed
The ministry explained that the corpus of the Employees' Pension Fund is made up of
(i) Contribution by the employer at 8.33% of wages
(ii) Contribution from the central government through budgetary support at 1.16% 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.
Wakchaure also asked if the present EPS pension of Rs 1,000-2,000 per month is inadequate to ensure a dignified life for elderly workers.
Karandlaje responded: “The government is providing a minimum pension of Rs 1,000 per month to pensioners under the EPS, 1995, through budgetary support, which is in addition to the budgetary support of 1.16% of wages provided annually towards EPS to Employees' Provident Fund Organisation (EPFO).
EPS 2026 scheme has superseded EPS 1995 scheme
The EPS 2026 scheme superseded the EPS 1995 scheme this month.
Early this month, the government notified the Employees' Pension Scheme (EPS), 2026, under the Code on Social Security, 2020, replacing the EPS, 1995, and Employees' Family Pension Scheme, 1971.
Key changes introduced under EPS-2026
While many provisions remain unchanged, the new EPS scheme introduces several changes, including:
-Pension claims to be settled within 20 days
-12% interest on delayed pension claims
-Higher pension provisions incorporated into the scheme
-Digital compliance requirements for employers
-Scheme renamed from Employees' Pension Scheme, 1995, to Employees' Pension Scheme, 2026
EPS pension formula
The pension calculation formula remains unchanged under the EPS 2026 scheme. Monthly Pension = (Pensionable salary × pensionable service) ÷ 70
Pensionable salary will continue to be the average monthly salary drawn during the last 60 months before exiting the pension fund.
أسئلة مفتوحة
- Will the government consider increasing the minimum EPS pension in the future?
- What specific measures will be taken to ensure the long-term sustainability of the pension fund?
- What is the exact number of beneficiaries affected by the current minimum pension?
