EPFO Pension Hike: Retired Employees Demand Rs 7,500 EPS Pension

For years, trade unions and pensioner associations have been calling for an increase in the pension amount under the Employees’ Pension Scheme (EPS). Introduced in 1995, the EPS aims to provide a steady income to employees after they retire. However, despite these ongoing demands, the pension amount under this scheme has not been revised since the Employees Provident Fund Organisation (EPFO) set the minimum guaranteed pension at Rs 1,000 in 2014 for members who contribute for at least 10 years.

The Push for Change

While the government has yet to revise the minimum pension amount, there is finally some hope for change. The EPS, which has been in place for nearly three decades, is set to be reviewed by external experts for the very first time. This review comes after growing concerns about the adequacy of the pension amount in light of rising living costs.

A parliamentary standing committee has directed the labour ministry to complete this third-party evaluation of the EPS within a set time frame, preferably by the end of 2025. The committee, led by Bharatiya Janata Party Member of Parliament Basavaraj Bommai, has emphasized the need to address the growing issue of the minimum pension being stuck at Rs 1,000.

Rising Costs and Stagnant Pensions

One of the key concerns raised by the parliamentary committee is the dramatic rise in the cost of living over the past few years. Inflation has surged, but the pension amount under EPS has remained unchanged. The committee pointed out that while inflation has “manifold increased,” the pension amount has stayed the same, which has led to a growing demand for an increase.

The committee also highlighted that it has taken 30 years for the EPS to undergo its first third-party review, and it strongly recommended that the evaluation process be completed by the end of 2025. The committee’s report underscores the need for an urgent revision of the pension amount.

What’s Being Done?

In response to the committee’s request, the ministry has started the process for the third-party evaluation of EPS. The ministry informed the committee that it is currently working on the review through a Request for Proposal (RFP) process. This review is a significant step, as no such evaluation has been conducted in the past.

Additionally, the report notes the pressing need for an upward revision of the pension amount, given the substantial rise in the cost of living between 2014 and 2024, among other factors.

Efforts to Increase the Pension Amount

The issue of raising the EPS pension has been a long-standing demand. In 2020, the ministry proposed an increase in the minimum pension to Rs 2,000. However, the Finance Ministry did not approve this proposal. This discussion resurfaced ahead of the 2024-25 budget, when retired EPS-95 employees met Finance Minister Nirmala Sitharaman to request an increase in the pension to Rs 7,500 per month. The EPS-95 National Agitation Committee, which represents retired employees, later stated that the Finance Minister assured them the government would review their demand.

Unions’ Demand for Rs 7,500 Pension

For several years, employee unions have been pressing for a pension increase, with many arguing that Rs 1,000 is far too low to meet the rising costs of living. Their goal is to see the minimum pension raised to Rs 7,500, along with the inclusion of a Dearness Allowance (DA) to help counter inflation.

What’s Next?

With the third-party review of the EPS underway and the ongoing discussions about raising the pension, there is hope that the government will finally address the concerns of trade unions and retired employees. The outcome of this review could lead to a significant increase in the minimum pension, helping to improve the financial security of many retired workers.