Good News For Pensioners In May? Rs 3,000, Rs 7,500, Or Rs 9,000, What Will Be Minimum EPS Pension? New Update

Employees Pension Scheme: There is an expectation that EPFO may hike the minimum pension under its EPS scheme for salaried employees. A similar is expected in May 2025. However, what will be the EPS hike has seen mixed speculation. Many reports state that the minimum pension hike could be Rs 3,000, Rs 7,500 or even Rs 9,000.

It needs to be noted that these are speculation and no official statement has been made either by the government of India, or EPFO. Hence, GoodReturns.In could not confirm the development.

EPS Minimum Pension:

The current minimum pension under EPS is set from Rs 1,000 to Rs.2,000 monthly for pensioners. This was started by the government on September 1st, 2014, along with providing additional budgetary support to the EPF scheme, as per ClearTax.

The EPS scheme has been in place for nearly three decades now. Launched on November 16, 1995, the EPS scheme is a social security option, developed by EPFO for employees in all organised sectors. Under EPS, the employer should contribute 8.33% of the employee's salary to the EPS account within 15 days of the closing of every month. Further, the central government is also liable to contribute a 1.16% rate to the funds.

Since it has been nearly a decade since the revision of the EPS scheme. Trade unions and other associations have been demanding a hike in EPS since it has been nearly a decade since the minimum pension underwent revisions.

As per reports, the pension body, EPFO has reportedly appointed a parliamentary committee to conduct a third-party review of EPS scheme of 95. Headed by BJP MP Basavaraj Bombay, the committee has reportedly sought the Union Labour Ministry to take action on the matter. The goal of third-party review is to put in place independent experts and gather recommendations regarding EPS which is expected to include revision in EPS.

Good News For Pensioners Ahead?

EPS Pension Hike:

As per the Times Now Telugu report, although there were proposals to increase the minimum pension to Rs 2000 in 2020, the Finance Ministry rejected those proposals citing some reasons. However, on the other hand, there is also a demand for a new pension of up to Rs 9000. Pensioners are demanding that this decision be taken in the context of the current increased costs.

If a Rs 9,000 pension is announced then that would mean an 800% hike in the minimum pension from Rs 1,000.

However, another report predicted that the minimum pension could be increased to Rs 3,000. If this is announced then the surge will be a whopping 200% from the Rs 1,000 minimum pension.

Earlier, a Finance Express report said that the panel may enhance the minimum EPS pension of Rs 1,000. FE cited the panel's report that revealed that considering the manifold increase in the cost of living in 2024 vis-à-vis 2014 and other relevant factors, there is a need to seriously consider an upward revision of this amount. The report stated that the panel may hike the pension to Rs 7,500 from Rs 1,000.

If the minimum pension is hiked to Rs 7,500, then it will be a whopping 650% increase from Rs 1,000.

Who Is Eligible For Pensions?

An employee is entitled to a superannuation pension if he or she has rendered eligible service of 10 years or more and retires on attaining the age of 58 years.

Further, early pension is granted if he or she has rendered eligible service of 10 years or more and retires or otherwise ceases to be in employment before attaining the age of 58 years.

EPFO New Changes:

While the expectation of an EPS hike floats, the EPFO has already made a big change by making it easier for provident fund account holders when they switch their jobs.

Earlier, the process to shift your EPF and EPS account was lengthy when switching jobs, because an employee required two EPFO approvals, such as the source office, which is required when leaving one job, and second would be Destination Office which is required when joining a new job. Apart from there was also employers' approval required.

Under the new rule, now when you switch jobs, the only approval that will be needed is from EPFO's source office, to credit your EPF and EPS amount from the old office to new office. Also, EPFO has removed the requirement of employers' approval too. The new process is part of the revamped FORM 13 form which EPFO launched recently.

In its notification on April 25, EPFO announced that with a view to further simplify the transfer claim process, the Form 13 (Transfer-Out) functionality has been since revamped duly incorporating the bifurcation of taxable and non-taxable components of PF accumulations.

According to the notification, the 3 level processing at the Transferee (Destination) office has been dispensed with. It is to be specifically noted that once the transfer claims get approved at the Transferor (Source) office in the revamped functionality, the PF accumulation and Pension Service of the members pertaining to the previous account will automatically get added to the present account at the Transferee (Destination) office without the requirement of additional processing.