Centre May Increase EPS Minimum Pension from Rs1,000 to Rs3,000 Monthly:

Suspense Crime,Digital Desk: EPS Pension Increase: The minimum pension under the Employees’ Pension Scheme (EPS) may be increased from ₹ 1,000 to ₹ 3,000 per month. This change could be implemented in the coming months, according to a senior government official who spoke with Moneycontrol. This decision comes at a time when there are rising concerns about the increasing inflation and the social security of senior citizens.

What is EPS?

EPS is a scheme allotted for the retirement of employees in organized sectors in India. It is managed by the Employees’ Provident Fund Organization (EPFO). Its aim is to ensure a sustenance for employees in the private sector after they retire in the form of a monthly payment. The funding for this scheme is provided through the employer, that is the company. From the total employer's contribution of 12% in EPF (Employees’ Provident Fund), 8.33% is earmarked for EPS while the rest 3.67% is reserved for EPF.

An official further says: “We are working on the enhancement of the minimum pension to ₹ 3,000 per month. It has been due for a long time now.” In 2020, the Ministry of Labour proposed an increase in the minimum pension to ₹ 2,000 to the Finance Ministry, but it was turned down.

Demand for pension of ₹ 7,500 also

In a discussion regarding the budget, EPS retired employees’ associations in March 2025 had put forward a demand to the Finance Minister to increase the minimum pension to ₹ 7,500, but they were not given any commitment.

As of now, the EPS trust has a corpus of over ₹ 8 lakh crores. This scheme has around 78.5 lakh pensioners, out of which 36.6 lakh are receiving a meager minimum pension of ₹ to1,000 per month.

Discussion continues on the financial consequences

As per one officer, at present the Ministry of Labor is working on the additional financial burden that would come with implementing the ₹ 3000 pension. The government’s expenditure on providing a minimum pension to EPS pensioners during FY 2023-24 is estimated at ₹ 1,223 crores, which is an increase of 26% over the previous year’s spending of ₹ 970 crores in FY 2023.

Since September 2014, government provides subsidy for a minimum payment of pension of ₹ 1,000, which means if a person's pension amounts to less than ₹ 1,000, then the government subsidizes the difference.

Evaluation of the Parliamentary Committee and Specialist Group

A few weeks ago, the Parliamentary Committee chaired by BJP MP Basavaraj Bommai proposed to the Labor Ministry to lift the minimum EPS pension without delay because there has been a surge in inflation along with other economic indicators.

“The proposal is positive in the event of an increase of the EPS pension, particularly in the case of the economically weaker section retirees and their families, “ remarked Akhil Chandna, partner, Grant Thornton India.

BJP’s own economist Sandeep Vempati noted the retail inflation rate or the consumer price index (CPI) grew 72% from March 2014 to March 2025. The International Labor Organization also supports the stance of associating pensions with inflation. Some explain the delay and the amount of pension uncertainty due to the global economic situation, combined with the government’s fiscal policies.