EPS Pension Hiked To RS 8,500 Monthly: Big Boost For Private Sector Employees

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In a major development to see private-sector retired employees financially secured, the Employees’ Provident Fund Organisation has converted the minimum pension payable under the Employee’s Pension Scheme to ₹8,500. This change to become effective from mid-2025 stands amongst the most worthy reforms that have happened recently and is expected to benefit millions of pensioners all across India.

What Is The EPS Pension?

EPS was started way back in 1995 with the purpose of giving some measure of regular income to private-sector retired employees. It is being administered now by EPFO and funded by contributions from employers and the Government. Until recently, the minimum pension was ₹1,000, which had been criticized by many as insufficiently small considering the increase in prices over the last few years.

The Pension Increment: Important Highlights

  • New Minimum Pension: Though inapplicable the earlier minimum pension of a mere Rs.1,000 per month, as a result of the increase now recorded, the new minimum pension under EPS stands at Rs.8,500, 8-fold. 
  • Effective Date: It will be operative from July 2025.
  • Precondition: The employee needs to have contributed to EPS for at least 10 years and shall be above the age of 58 for pension eligibility. For all current pensioners, there shall be a direct enhancement for pension to the extant rates.
  • Inflation Provision: The government plans to keep adding some Dearness Allowance (DA) amount to the pension subsequently so that it is insulated from inflation, if at all.

Who Will Gain?

Essentially, the update is for private-sector employees who have been covered under the EPFO scheme, mainly those retiring or who are to retire without any other significant source of retirement income. It is gradually going to benefit around 78 lakh pensioners registered under EPS-95.

Government’s Motive

It is in consonance with the long-established goal of the central government to provide social and financial security to its aged citizens. Raising EPS is seen as a step toward providing a “social security net” to the aging private workforce in India.

Also Read:8th Pay Panel Moves Ahead: Minimum Wage Proposal And ToR In Focus

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