The Union Government is actively examining a proposal to increase the minimum pension under the Employees’ Pension Scheme (EPS), 1995), aimed at improving retirement income for millions of pensioners across the country. Currently, the minimum pension stands at Rs 1,000 per month, a figure that has remained unchanged for years despite rising living costs.
Labour and Employment Minister Dr. Mansukh Mandaviya said the matter is under review and will soon be placed before the Union Cabinet for consideration. The proposal seeks to provide enhanced financial support to pensioners, especially those in lower income groups who depend solely on EPS benefits for post-retirement sustenance.
Several labour unions and pensioners’ associations have been demanding an upward revision, arguing that the current amount is insufficient to meet basic household needs amid inflation. The government has acknowledged these concerns and is evaluating possible options that balance pension adequacy with the long-term financial sustainability of the Employees’ Pension Fund.
The EPS operates as a defined contribution and defined benefit scheme, with employers contributing 8.33 percent of employees’ wages toward the pension fund and the government adding a smaller share. However, actuarial assessments in recent years have indicated stress on the fund’s corpus, prompting the need for reforms that ensure both higher payouts and fiscal viability.
Officials are studying different models for pension enhancement, including a phased increase and the introduction of a variable minimum pension linked to inflation. Once the Cabinet approves the proposal, the revised pension is expected to benefit over 6.5 crore EPF members and lakhs of existing retirees.
The move, once implemented, would mark a major step toward strengthening India’s social security system and improving the quality of life for pensioners who have contributed to the organized workforce throughout their careers.
