Big Relief Coming for Private Sector Employees: Government Plans to Raise EPS Minimum Pension to ₹7,500

New Delhi — In a significant development that could benefit crores of private sector employees, the Central Government is reportedly considering a major increase in the minimum monthly pension under the Employees’ Pension Scheme (EPS). According to government sources, the proposal aims to hike the pension from the current ₹1,000 to as much as ₹7,500 per month, following long-standing demands from trade unions and pensioners’ bodies.

EPS Minimum Pension Likely to Triple to ₹3,000 Initially

According to a Moneycontrol report, the government is preparing to raise the minimum EPS pension to ₹3,000 in the initial phase, a move that could be implemented within the next few months. This would mark the first increase in the minimum pension since 2014, when it was raised from ₹250 to ₹1,000.

An official source confirmed the move, stating,

“The Ministry of Labour has recommended increasing the pension to ₹3,000 per month, and consultations with the Finance Ministry are currently underway.”

How the EPS Pension System Works

The Employees’ Provident Fund Organisation (EPFO) handles the pension distribution through the Employees’ Pension Scheme (EPS). Here’s how it functions:

• 12% of the basic salary is deducted as an EPF contribution by the employee.

• The employer contributes an equal amount, of which 8.33% goes into EPS and 3.67% into EPF.

• The accumulated EPS amount is then disbursed as a monthly pension post-retirement.

Despite the growing number of pensioners, the pension slab has remained unchanged for over a decade, even as inflation and cost of living have surged.

Parliamentary Panel Recommends Pension Hike to ₹7,500

In a strong push for reform, a parliamentary standing committee recently recommended that the minimum EPS pension be raised to ₹7,500 per month. The suggestion has received widespread support from employee unions and retiree associations, which have long argued that the current amount is inadequate to sustain basic living expenses.

If approved, this move will bring significant financial relief to millions of retired workers in the private sector, many of whom currently struggle with minimal pension income.

Awaiting Final Approval: What Comes Next?

Although the central government appears to be actively considering this proposal, final approval is still pending from the Finance Ministry. If cleared, the hike would represent a landmark social security reform, directly improving the lives of pensioners and retirees across the country.

While a pension of ₹3,000 is likely in the short term, the long-standing demand for ₹7,500 remains under active discussion. A final decision may emerge in the coming months, especially as social welfare remains a top agenda item ahead of upcoming policy announcements.