Financial Impact on EPFO (If all Pensioners and Members who earn above the wage ceiling opt for Higher Pension)
EPFO in various affidavits presented in various High Courts & Supreme Court states that if Higher Pension is given to all Pensioners there will be additional Financial Liability of 15 lac crores. Let us examine this statement on the basis of following data (collected and analysed from Annual Report, Affidavit & RTI). Data is Prepared by Hon. Neeraj Bhargava and shared by Hon.Parveen Kohali.
Members of Exempted establishments are 4.5% of total Pension fund members and Pensioners are only 2.71% of total pension fund members.
c) Members who earn above the wage threshold of Rs. 15,000/-
(Annexure A2: Affidavit by Mr. Jag Mohan, ACPFC-Legal (HQ) EPFO, in Review petition 1430-1431 of 2019 in SLP(C) 8658-8659 of 2019 dt 28-01-2021)
2. Pensioner getting Higher Pension
a) Data of 24,672 Pensioners in compliance of EPFO HQ circular dt 23-03-2017
(Annexure A3a: No of pensioners getting pension on actual salary dt 17-01-2020)
Based on 24,672 pensioner data calculations have been done to find out average amount per pensioner.
b) Average data per pensioner
(Annexure A3b: No of pensioners getting pension on actual salary dt 17-01-2020 with Analysis)
3. Calculations of Financial Impact on EPFO due to pension on Higher Salary
Based on average amount calculated in 2 (b) above a table made for financial impact due to Higher pension from 1% to 100% of Pension members.
a) Pensioners
b) Members who earn above the wage threshold of Rs. 15,000/-
4. Conclusion:
From above it can be seen that even if 5% of members (6,32,878) who earn above the wage threshold of Rs. 15,000/-, the one-time increase in Corpus will be Rs. 18,562 crores and Interest amount earned on this corpus will be extra. Because no arrears have to be paid to these members and higher pension of these members will start as and when they will be superannuated.
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