EPS 95 Minimum Pension Hike: EPFO Larest Reply on EPS 95 Minimum Pension Hike, Every EPS 95 Pensioners Must Know

No: Pension.I/Misc/2020/Agitation    Dated:03.05.2021

To,

Prakash Pathak

National General Secretary

Employees Pension 1995 Co-ordination Committee

Sub:-  Humble  request  to  Hon.Shri Apurva Chandraji ,Internatonal Labour Organisaton Chairman, Email with Video Speech link to help  EPS 95 Pensioners without any Delay in Covid 19 Pandemic with second wave.-regarding.

Sir,

Please refer to above cited subject.

In  this  regard  the  mater  has  been  examined  and  the  comments  of  EPFO  are submited as below:

 (i) With  regard  to  enhancement  of  minimum  pension,  it  is  stated  that  the  Employees Pension  Scheme  1995  is  a self  funded  scheme  with  contributons  @ 8.33%  of  wages  from employer and  @1.16% of  wages  by Central Government. All  benefts  under  the  scheme is paid out of such accumulatons. The fund is valued annually and additonal reliefs paid, if the positon of the fund so permits. In the year 2000, the pension fund ran into defcit and no additonal  reliefs  could  be  paid  thereafer.  In  spite  of  this  fund  defcit,  the  Central Government has enhanced minimum pension to Rs. 1000/- p.m. with efect from 01.09.2014 by providing budgetary support keeping the wide spread demand in view even though there is no provision in scheme for such budgetary support. It is not possible to increase pension amount further without compromising the fnancial viability of the Scheme.

With regard to linkage of pension under EPS, 1995 with Dearness Allowance (DA), it is informed that the  issue  of  index  linking  of  pension  by  fully  neutralizing  infaton  was  considered  by  the  Expert Commitee consttuted by the Central Government in the year 2009 for review of EPS, 1995 and the same was found not feasible in the case of a funded scheme like Employees’ Pension Scheme, 1995. In Employees’ Pension Scheme, 1995 the contributon of the employer and Government is at a fxed rate of 8.33% and 1.16%. Therefore, the value of benefts cannot be lef open ended by linking with infaton  as  infaton  is  variable.  Therefore,  to  ensure  the  sustainability  and  viability of defned contributon and defned benefts schemes like EPS, 1995 feasibility of providing such beneft is required to be kept in view.

(ii) Further  regarding  revision  of  pension  on  higher  wages,  it  is  hereby informed that since the pension fund is in actuarial defcit to the tune of Rs.15,531  Crores  (as  on  31.03.2017),  it  is  not  fnancially  feasible  to increase  the  benefts  payable  under  the  scheme.  Furthermore,  as  the matter  of  revision  of  pension  on  higher  wages  is  currently  sub-judice, further decision is this matter shall be taken on fnalization of the court proceedings.

This is for your information please.

Yours faithfully,

(Kartikey Singh)

Regional P.F. Commissioner-I (Pension)