New Delhi: There is no plan to link the Employees’ Pension Scheme (EPS) with the inflation index, the Union labour ministry informed Parliament on Wednesday and said that an expert committee has not recommend such a move.
The government had constituted a committee for complete evaluation and review of EPS 1995, considering the demands of EPS 1995 pensioners, the ministry said.
“The committee did not recommend linking the monthly pension under EPS 1995 with the cost-of-living index as according to actuarial evaluation linking EPS 1995 with price index, DA (Dearness Allowance) relief will severely affect the financial health of the pension fund,” the ministry said in a written reply in Parliament.
The ministry has received representations individually and collectively from EPS pensioners to hike the basic minimum pension from ₹1,000 a month now to ₹3,000.
“Representations have been received from individual pensioners as well as pensioners associations for increase of minimum pension under EPS 1995 with reference to the recommendations of the Koshiyari Committee. The government has, for the first time, started providing a minimum pension of ₹1,000 per month to the pensioners under EPS 1995 from 1 September 2014 by providing additional budgetary support keeping in mind the widespread demands in addition to the budgetary support of 1.16% of wages of the member by the government,” the ministry said in a written statement. However, the ministry did not say whether or not it is going to increase the minimum pension.
All employees’ provident fund subscribers contribute to the pension corpus, but the government gives incentive (1.16% of wage extra) to those drawing a salary of less than ₹15,000 per month. EPS is part of the Employees Provident Fund Organisation (EPFO). Every month of the 12% employer’s share of EPF deductions 8.33% goes to the pension corpus.
The demand for a ₹3,000 pension under EPFO gained momentum after the government launched the Prime Minister Shram Yogi Mandhan (PM-SYM) Yojana in 2019 for informal workers. PM-SYM assures a monthly pension of at least ₹3,000 after the person has attained the age of 60.
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