Centre Mulls Raising EPS Minimum Pension to ₹3,000 Per Month

As per Moneycontrol news report, in a significant move that could impact millions of retired workers in India, the central government is likely to raise the minimum pension under the Employees’ Pension Scheme (EPS) to ₹3,000 per month from the current ₹1,000, according to a senior government official quoted by Moneycontrol.

This development comes amid rising inflation and long-standing demands from pensioners for a revision in the minimum pension amount.

Government Plans to Revise EPS Pension Amid Fiscal Challenges

The Employees’ Pension Scheme, managed by the Employees’ Provident Fund Organisation (EPFO), is a key retirement benefit programme for employees in the organised sector. It is funded by a portion of the employer’s contribution to the Employees’ Provident Fund (EPF), where 8.33% is diverted to EPS and the remaining 3.67% stays with EPF.

As per the Moneycontrol report, the proposed increase in the minimum pension is likely to be implemented in the coming months. Previously, in 2020, the labour ministry had proposed an increase to ₹2,000 per month with budgetary support, but the finance ministry did not approve the plan.

During the 2025 pre-budget consultations, a delegation of EPS pensioners had urged Finance Minister Nirmala Sitharaman to raise the pension to ₹7,500 per month. However, they did not receive any formal assurance. The total corpus of the EPS is over ₹8 lakh crore, with about 7.85 million pensioners, including more than 3.66 million receiving the minimum pension of ₹1,000.

Inflation, Parliamentary Concerns, and Financial Impact

The labour ministry is currently assessing the financial implications of raising the pension to ₹3,000. In FY24, the government spent ₹1,223 crore towards minimum pension payouts—an increase of 26% from ₹970 crore in FY23. Since September 2014, the central government has provided a grant-in-aid to cover the difference between the minimum pension of ₹1,000 and the actual pension if it is lower.

Nonetheless, the final decision and timeline remain uncertain due to the global economic climate and the Union Government’s fiscal targets.

Read More: EPFO Minimum Pension Hike: Will Govt Approve ₹7,500 Minimum Pension Demand?

Conclusion

The proposed revision of the minimum EPS pension to ₹3,000 reflects the government’s recognition of inflationary pressures and pensioners’ long-standing demands. However, budgetary constraints and policy considerations may influence the timing and scale of its implementation.

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