If camping on EPS is removed in 2022, then if the pension is more than Rs 7,500 and if the cap is removed, then if the pension is calculated on the basic salary of Rs 20,000, then it will get a benefit of Rs 8571.
Employee Pension Scheme. Employees of Employees’ Provident Fund can get good news soon. If the limit of calculating 15000 pension is removed, then in 2022 the amount of pension of the employees can be doubled. At present, the entire matter is pending in the Supreme Court and the hearing is going on.
On the other hand, EPFO is preparing to bring a new pension scheme soon, in which the employees with monthly basic salary of more than Rs 15,000 will get benefit i.e. those currently organized sector employees whose basic salary (Basic Pay and Dearness Allowance) will be given. ) up to Rs 15,000, compulsorily covered under EPS-95.
According to media reports, under the Employee Pension Scheme ie EPS Pension, there is currently a ceiling or capping of Rs 15000 per month for pension, to remove it from the Union of India and the Employees’ Provident Fund Organization (EPFO). A petition has been filed in the Supreme Court on 12 August 2021, the hearing of which is still going on and the decision is likely to come soon. If the camping on EPS is removed in 2022, then if the pension exceeds Rs 7,500 and if the cap is removed, if the pension is calculated on the basic salary of Rs 20,000, then it will get a benefit of Rs 8571.
Understand the whole math like this
Actually, for the calculation of pension on the retirement of the employee, the maximum salary is considered to be Rs 15000. If the limit of Rs 15000 of EPS is removed, then the amount of pension of the employees will be doubled, in such a situation, after retirement, the employee can get only Rs 7,500 as pension under the EPS rule, but the contribution of EPS will also have to be increased. .
The contribution of basic salary in EPF is 8.33%. Members of Provident Fund Organization also become members of EPS (Employee Pension Update). Under the Employee Pension Scheme, 12% of the salary from the employee’s account is PF and later the same amount goes to the employer’s account as well.
For example, if the limit of 15000 from pension is abolished and basic salary is made 20000, then the amount of pension is more than 7500 i.e. 8,571 (20,000 X 30) / 70 = Rs 8,571. will get. For this, you can check the EPS calculation with the formula = Monthly Pension = (Pensionable Salary x EPS Contribution) (Monthly Pension = Rs 15,000X30/70-6428), but for this, the employer’s contribution to EPS will also have to be increased, so that To get the amount of pension at the time of retirement. That means every month the pension share is maximum (8.33% of 15,000) Rs 1250.
Preparation for introducing new scheme
On the other hand, Employees’ Provident Fund Organization (EPFO) is preparing to bring a similar scheme for employees. According to media reports, under this, EPFO will give monthly basic salary of more than Rs 15,000 to employees in it. PF account holders have been demanding the increased pension scheme for a long time, so also for the employees who are not compulsorily covered under the Employees’ Pension Scheme-1995 (EPS-95). A new pension scheme is being considered.
Decision will be taken in CBT meeting
It is expected that its proposal may be brought in the CBT meeting to be held in March next month. The Central Board of Trustees (CBT), the apex decision-making body of EPFO, is going to have a big meeting in Guwahati next month on 11-12 March 2022. In this meeting, the proposal related to the new pension scheme will be discussed. In such a situation, it is being actively considered to bring a new pension product or scheme for those people whose monthly basic salary is more than Rs 15,000.
