EPFO: For years, millions of EPS-95 pensioners across the country have been demanding an increase in their minimum pension from the current Rs 1,000. They are also demanding dearness allowance (DA), family pension, and free medical care. With rising inflation, it has become extremely difficult for the elderly to survive on a Rs 1,000 pension. This is why pensioners are constantly hoping for relief from the government.
Recently, this issue was raised again in Parliament. Members in the Lok Sabha explicitly asked the government why the minimum pension increase under the EPS was being delayed and why it was taking so long to implement the Supreme Court’s orders regarding pension fixation. In response, the Ministry of Labor and Employment detailed its position.
What is the current availability of EPS pension?
The government has indicated that the minimum pension under EPS-95 is set at Rs 1,000 per month, a figure established in 2014. At that time, the government ensured budgetary support so that no pensioner would receive less than this amount. However, since then, inflation has continued to rise, while the pension amount has remained the same. It’s important to note that EPS pensions are not adjusted according to dearness allowance or the cost of living index.
How does the EPS pension fund operate?
The ministry clarified that EPS functions as a social security scheme that relies on pooled funds. Employers contribute 8.33% of an employee’s salary, while the government adds 1.16%, capped at a maximum salary of Rs 15,000. This fund is used to pay pensions and other benefits.
The government has acknowledged that the EPS fund is experiencing a significant financial shortfall, or actuarial deficit. Data from March 31, 2019, indicates that it is not feasible to offer substantial pension increases or dearness allowances given the current fund levels. The government has confirmed that additional budgetary support is being provided to maintain the minimum pension of Rs 1,000.
What was the committee’s stance on providing DA?
A high-level committee looked into the possibility of linking EPS pensions to dearness allowance. Their report concluded that, considering the current state of the fund, it is not feasible to provide DA or to link pensions to inflation. As a result, no further decisions could be made regarding this request.
Will the pension increase further?
The government outlined its problems and progress made so far, but did not provide a clear timeline for increasing the EPS minimum pension to Rs 7,500, providing DA, or adding medical benefits. Consequently, the wait for EPS-95 pensioners continues, and their hopes are currently in limbo.