EPFO Central Board meeting on Oct 10-11: Will the minimum EPF pension increase? What reports say

The Employees’ Provident Fund Organisation’s decision-making body, Central Board of Trustees (CBT), is set to meet in Bengaluru on October 10 and 11. As per reports, the board may discuss a proposal to increase the minimum pension to ₹2,500, from ₹1,000 currently.

The minimum pension under the Employees’ Pension Scheme 1995 (EPS-95) has remained the same, at ₹1,000 per month, since 2014. If the pension is hiked this time, it would be the first revision in 11 years, providing a Diwali gift to employees and pensioners.

What is EPS-95?

The EPS-95 is a social security programme in which the pension fund draws 8.33% of wages from employers and 1.16% from the Central Government (capped at ₹15,000 per month). The scheme offers a minimum guaranteed pension through government intervention in case of an actuarial deficit.

Currently, the EPS-95 provides for a minimum pension of ₹1,000 per month, even if the amount in the employee’s pension fund doesn’t have enough.

The EPS fund is under stress due to actuarial deficits, which happen when promised benefits exceed the funds available to meet them.

Employees above the age of 58, with at least 10 years of continuous service, are eligible for a regular pension under EPS.

Minimum pension hike

Trade unions have been demanding an increase in the minimum pension for many months now. While the demand is for a minimum pension of ₹7,500 a month, reports say that a feasible hike would be to ₹2,500.

With rising inflation and increased living costs, the fixed minimum pension of ₹1,000 is not enough for retirees to afford basic necessities. Pensioners and labour unions argue that the current pension does not fairly compensate for decades of service and contributions by employees.

Other expectations from the CBT meeting

The board is meeting after seven months, and is expected to discuss many important matters, including the implementation of EPFO 3.0 and introducing a digital overhaul enabling smoother EPF transactions.

The proposed reforms under the EPFO 3.0 can provide a much-needed relief for the middle class, boosting liquidity and encouraging festive consumption.

The expected upgrades under EPFO 3.0 are:

• PF money withdrawal through ATM and UPI
• Efficient claim processing with auto-claim settlement
• Digital services to streamline the whole process
• OTP-based authentication
• Simplified death claim processing
• Easier correction and updating process

EPFO members are now eagerly waiting for the October meeting, which could announce key measures that could benefit millions of subscribers.