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In a significant move after decades of stagnation, the Parliamentary Standing Committee on Labour has urged the Centre to expedite the first-ever third-party evaluation of the Employees' Pension Scheme (EPS-95) and review the stagnant minimum pension of Rs 1,000 per month, which has remained unchanged since its last revision in 2014.
The EPS, launched in 1995 and managed by the Employees’ Provident Fund Organisation (EPFO), provides a lifelong pension to employees after retirement. Despite inflation and rising living costs, the minimum pension under the scheme remains fixed at Rs 1,000 for those who contributed for at least 10 years—prompting years of agitation from trade unions and pensioners’ bodies.
Panel Sets Deadline for Review
The committee, chaired by BJP MP Basavaraj Bommai, has asked the labour ministry to ensure the external evaluation is concluded within a “definite timeframe, preferably by the end of 2025.” The review is expected to assess the sustainability, adequacy and financial implications of the EPS in its current form.
The labour ministry has informed the committee that the evaluation process has already begun through a Request for Proposal (RFP) and is currently underway. Notably, this is the first formal review in EPS’s 30-year history.
Government Under Pressure
The report also confirmed that a proposal to increase the pension to Rs 2,000 was sent to the Finance Ministry in 2020 but was not approved. It was later included in discussions for the 2024–25 Budget. Additionally, in a pre-Budget meeting this year, a delegation from the EPS-95 National Agitation Committee urged Finance Minister Nirmala Sitharaman to raise the minimum pension to Rs 7,500 per month and include a dearness allowance (DA) component.
Though no commitment has been formalised, the committee said the labour ministry must treat the matter “with a sense of urgency.”
A Ray of Hope for Pensioners
Trade unions, which have long argued that the existing pension is insufficient to support retirees amidst soaring inflation, welcomed the committee’s intervention. The EPS-95, with millions of pensioners under its umbrella, has become a symbol of broader concerns over pension reforms in India.
If accepted, the revision could represent the most meaningful change in the pension system for government and private sector employees in over a decade.
