EPS 95: How the govt funds ₹1000 pension and what it says on ₹7500/month plan

For months, various reports have said that the Government may be planning to increase the minimum pension under the Employees' Pension Scheme 1995 (EPS 95) from ₹1000 to ₹7500. In October 2025, multiple media reports claimed that the EPFO's Central Board of Trustees (CBT) may discuss the proposal to increase the EPS pension amount. However, nothing was confirmed officially.

According to the Government's recent statement in the Lok Sabha, there appears to be no plan at present to increase the EPS 95 pension amount.

On the first day of the ongoing Winter Session of the Parliament on December 1, 2025, Union Minister of State (MOS) for Labour and Employment, Shobha Karandlaje, replied to a query on "whether the Government is contemplating to increase the minimum pension under EPS-95 from 1,000 to 7,500 per month."

In her written reply, the MOS explained how the government is already funding the EPS 95 pension at ₹1000 per month by providing additional budgetary support over the existing budgetary support of 1.16% of wages provided annually towards EPS to the Employees Provident Fund Organisation (EPFO).

Let's understand how the government funds the EPS pension, according to the minister's reply in the Lok Sabha.

The EPS corpus is made up of the following:

1. Contribution by the employer @ 8.33% of wages

2. Contribution from Central Government through budgetary support @ 1.16% of wages up to an amount of ₹15,000 per month.

All benefits under the scheme are paid out of the accumulated EPS corpus. Further, the fund is valued annually as per paragraph 32 of the EPS, 1995 rules.

According to the ministry, there is an actuarial deficit as per the valuation of the EPS fund as on March 31, 2029. However, this deficit is funded by the budgetary support from the government.

"However, the Government is providing a minimum pension of ₹1000 per month to the pensioners under the EPS, 1995 by providing budgetary support, which is in addition to the budgetary support of 1.16 per cent of wages provided annually towards EPS to Employees’ Provident Fund Organisation (EPFO)," the minister said.

"The Government of India is committed to ensure maximum benefits for workers under the EPS-95 scheme, duly taking into consideration the health of the respective funds as well as the future liabilities thereon," she added.