Under the Employees’ Pension Scheme (EPS-95), pensioners currently receive a minimum pension of ₹1,000 per month, a rate unchanged since 2014. Rising inflation and growing demands from pensioners’ associations have pushed the government to reconsider this low amount. In late 2025, discussions intensified over a proposal to increase the minimum pension from ₹1,000 to ₹2,500 per month, though official confirmation is still awaited.
Background
The EPS-95 scheme, managed by the Employees’ Provident Fund Organisation (EPFO Pension), provides retirement benefits to workers in the organised sector who have completed at least 10 years of eligible service.
Currently, over 7.8 million pensioners are covered under EPS-95, with an estimated 4 million receiving the minimum ₹1,000 pension.
The existing rate has become inadequate due to inflation, and several parliamentary committees, trade unions, and retirees have urged the government to revise it upward.
Proposed Hike Details (2025)
- The proposed increase seeks to revise the minimum pension to ₹2,500 per month. However, pensioners’ associations are actively demanding a hike to ₹7,500 per month.
- Discussions in the Central Board of Trustees (CBT) have centered on both the ₹2,500 and ₹7,500 figures to find a fiscally viable middle ground.
Reasons Behind the Move
- Inflation Pressure: The cost of living has more than doubled since the ₹1,000 rate was set in 2014.
- Welfare Demands: Pensioners’ organisations have campaigned for a hike citing hardship among low-income retirees.
- Policy Review: The government has initiated a third-party evaluation of EPS-95, expected to guide pension reform by 2026.
- Social Security Expansion: The revision supports India’s broader goal of improving retirement security in the formal workforce.
Expected Benefits
- Enhanced income for around 3.5–4 million low-paid pensioners.
- Improved social protection and financial stability post-retirement.
- Boost to consumption, particularly in rural and semi-urban areas where pensioners largely reside.
Conclusion
The EPFO Pension Hike 2025 reflects growing recognition that the ₹1,000 pension level no longer supports a dignified life for older citizens. The proposed raise to ₹2,500 is a crucial step toward pension adequacy, though it awaits official approval. Once notified, it will bring substantial relief to millions of EPS-95 beneficiaries and mark a significant improvement in India’s social-security landscape.
NOTE: As of November 2025, the increase in the EPS-95 minimum pension from ₹1,000 to ₹2,500 is a PROPOSAL under active consideration by the Government and the EPFO’s Central Board of Trustees (CBT). It has NOT been officially approved or notified. Pensioners should rely only on official press releases from the EPFO Pension or Ministry of Labour & Employment for the final decision
FAQs
1. What is the current minimum EPS-95 pension?
Ans: ₹1,000 per month since September 2014.
2. What is being proposed?
Ans: A hike from ₹1,000 to ₹2,500 per month is the formal proposal actively under review. Pensioners’ associations are, however, campaigning for a higher increase of ₹7,500 per month.
3. Has the increase been officially approved?
Ans: Not yet. The proposal is under active government review and awaits formal notification.
4. Who will benefit most?
Ans: Retirees drawing less than ₹2,500, especially those from lower-income segments.
5. When is the change expected?
Ans: If approved, the revision is expected to be implemented in early 2026. The CBT meeting in October 2025 aimed to finalise the recommendation for the Cabinet.
6. How does this differ from the Supreme Court Higher Pension ruling?
Ans: The SC ruling (Higher Pension on Higher Wages) is for members who contributed on actual salaries above the ₹15,000 cap. This proposal (₹2,500 minimum pension) is a welfare measure for all minimum pensioners regardless of past salary contributions.
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