Pensioners who belong to the Employees’ Provident Fund Organisation (EPFO) can rejoice because industry experts are saying that the Employees’ Pension Scheme, 1995 (EPS-95) will soon witness a massive hike in the minimum pension amount, from ₹1,000 to ₹7,500 a month. This adjustment request is to really help the mill of poor retirees who have been battling for a long time against the high cost of living with their puny pensions.
What’s changing and why it is significant
The current EPS-95 regulations allow too many old-age retirees to draw very insignificant sums — usually, the lowest of ₹1,000 a month — which is now not enough because of the inflation and the living costs. The proposed rise to ₹7,500 would mean a 650 % hike in the minimum pension rate. For many pensioners who have been working for years but in the end, got very low pensions due to either the short service or the low pensionable salary, this change will be a long-awaited recognition and support.
Who is going to benefit
The revision is aimed at the EPS-95 scheme pensioners whose calculated pension is less than the new minimum limit. To put it simply, the pensioners whose pensions are now exactly at or near the minimum of ₹1,000 will gain the most. Although the detailed criteria for eligibility (like the length of service, the cap on the pensionable salary, the date of retirement) may need to be elaborated, the decision manifests the government’s willingness to elevate the lowest-paid retirees. It might also contribute to bringing the gap between the long-serving and the short-serving pensioners closer — by providing a more secure minimum pension.
Financial Implications & Implementation
Bringing up the least pension to ¥7,500 is definitely a financial problem for the administration. The transfer of pensioners from ¥1,000 to ¥7,500 will lead to a monthly increase of ¥6,500, or approximately ¥78,000 yearly, in extra pension income. This hike is very major throughout the lifetime of a normal retiree. However, no official announcement has been made regarding the effective date, payment of arrears/back-payments retroactively, and management of the change. Therefore, pensioners should lower their expectations, but at the same time, should be cautiously optimistic.
Also Read: New Gratuity Rules 2025: Bigger Benefits And Higher Limits For Government Employees