Crucial information regarding the Employees’ Pension Scheme (EPS-95) was provided in the Lok Sabha by the Ministry of Labour and Employment.
Union Minister of State Shobha Karandlaje clarified that the EPS-95 scheme fund is constituted through joint contributions from both employers and the Central Government.
However, the Minister’s statement highlighted concerns regarding the financial health of the fund. She revealed that an Actuarial Deficit was found in the valuation of the fund as of March 31, 2019.
Centre’s Measure to Guarantee ₹1,000:
Despite the fund deficit, the Central Government has given a major assurance to pensioners. The Minister stated that the government is currently allocating a separate budget to ensure a minimum monthly pension of ₹1,000 for all pensioners.
Shobha Karandlaje said, “The EPS-1995 is a ‘Defined Contribution-Defined Benefit’ social security scheme. Its corpus is formed by an 8.33 percent contribution from the employer and 1.16 percent budgetary support from the Central Government. All benefits are provided from this accumulated fund. Despite the deficit, the government is committed to ensuring maximum benefits for workers, but decisions will be taken considering the financial health and future liabilities of the fund.”
Under Pressure from Protests:
Meanwhile, protests demanding an increase in the minimum pension have intensified nationwide. Last month, the All Pensioners Retired Persons Association demanded that the minimum monthly pension under EPS-95 be raised to ₹9,000. Their members observe November 16 every year as ‘Black Day’ to protest. As part of this, pensioners also demonstrated in front of the Marripalem Regional PF Office in Visakhapatnam.
Currently, due to the old wage ceiling, the monthly pension for most beneficiaries is still limited to between ₹1,000 and ₹3,000. Although the government has not yet made a direct announcement on increasing the pension, the Minister’s statement indicates new possibilities for the future. It remains to be seen whether the employees’ demands are reflected in the upcoming budget.