Increase in Pension Under EPS, 1995: What You Need to Know
The Employees’ Pension Scheme (EPS), 1995, remains a cornerstone of retirement security for many workers in India. In recent times, several stakeholders, including trade unions, have urged the government to increase the minimum pension amount under this scheme. Here’s a detailed overview of the current situation:
- Stakeholder Representations
The Ministry of Labour and Employment has confirmed receiving requests from pensioners and trade unions for a minimum pension hike. These appeals reflect widespread concerns about the adequacy of pension benefits amidst rising living costs. - Current Structure of EPS, 1995
The EPS operates on a “Defined Contribution-Defined Benefit” model. Employers contribute 8.33% of wages, while the central government provides 1.16% of wages (up to ₹15,000/month). However, the fund faces an actuarial deficit as per the latest valuation (2019). - Government Initiatives
In 2014, the government introduced a minimum pension of ₹1,000 per month with additional budgetary support. Over the years, substantial grants have been released to ensure this provision:
2019-20: ₹5,096.67 crore
2020-21: ₹7,519.01 crore
2021-22: ₹18,478.33 crore
2022-23: ₹8,785.00 crore
2023-24: ₹9,127.00 crore
- Future Outlook
Despite increased budgetary allocations, the government is assessing the feasibility of further pension hikes. Any decision will likely consider the recommendations of the Standing Committee on Labour, Textile, and Skill Development.
The EPS, 1995, plays a pivotal role in social security, and any potential hike in pension benefits will bring much-needed relief to retirees. Stay tuned for updates as the government deliberates on this critical issue.
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