New Delhi: The Ministry of Labour and Employment has acknowledged the long-standing demand to increase the minimum pension under the Employees’ Pension Scheme (EPS-95) from the current Rs. 1,000 per month. The issue was brought to the forefront during an Unstarred Question (No. 576) in the Rajya Sabha on July 24, 2025, raised by Shri Vaiko and Shri M. Shanmugam.
Members of Parliament questioned the government on the timeline for a decision, especially given the mounting pressure from trade unions and various court judgments, and highlighted the availability of “sufficient funds” in the corpus and unclaimed funds. They also urged for an expedited decision in view of the upcoming festival season.
In response, the Minister of State for Labour and Employment, Sushri Shobha Karandlaje, stated that representations have been received from various stakeholders, including trade unions and public representatives, regarding the enhancement of the minimum pension.
The Minister elaborated that the EPS, 1995 operates as a “Defined Contribution-Defined Benefit” Social Security Scheme. The fund is primarily built from contributions by employers (8.33% of wages) and a significant contribution from the Central Government through budgetary support (1.16% of wages up to Rs. 15,000 per month). All benefits under the scheme are disbursed from these accumulated funds.
However, a key point of contention emerged regarding the financial health of the scheme. The Minister stated that as per the actuarial valuation of the fund as on March 31, 2019, there is an “actuarial deficit.”
Despite this deficit, the government currently provides a minimum pension of Rs. 1,000 per month to EPS, 1995 pensioners through additional budgetary support. This support is over and above the annual 1.16% of wages contributed to the Employees’ Provident Fund Organisation (EPFO) for EPS.
While the government acknowledges the demands and the ongoing dialogue, a definitive timeline for a decision on increasing the minimum pension was not provided in the response. The actuarial deficit, as highlighted by the Ministry, appears to be a significant factor in the ongoing deliberations.