The pensioners under The Employee’s Provident Fund Organisation (EPFO) may soon get to hear a good news as the government is looking to double the minimum monthly pension for retired organised sector employees.
The pensioners under The Employees’ Provident Fund Organisation (EPFO) may soon get to hear a good news as the government is looking to double the minimum monthly pension for retired organised sector employees. Sources told Zee Business that the minimum pension of Rs 1000 could be hiked to Rs 2000. The decision could be taken in central board of trustees’ meeting of EPFO on June 26.
The central board of trustees (CBT), the highest decision making body in EPFO, may put a stamp on the proposal later today ahead of the meeting tomorrow. The move is expected to benefit at least 40 lakh subscribers and cost the Centre Rs 3,000-4000 crore per annum.
Notably, the government has been deliberating on the issue for long taking into account the fact that Rs 1000 pension is inadequate to even take care of the food costs of an employee.
According to Zee Business reporter various labour unions have demanded hiking the monthly pension to Rs 7,000. However, this much hike looks improbable going by the fiscal burden on the government.
Watch Zee Business EPFO pensions video below:
The Union Cabinet had approved a minimum pension of Rs 1,000 a month for a year in 2014. After a year, the government extended it till perpetuity.
Every month, employees in organised sector contribute 12 per cent of their basic salary and HRA to EPFO as provident deduction, and a similar amount is contributed by the employer.
Of the employer’s contribution of 12 per cent, 8.33 per cent goes to employees’ pension scheme and the rest to the provident fund.
From the employer’s 12 per cent contribution, 8.33 per cent goes to employees’ pension scheme and the rest to the provident fund.
EPFO contribution is mandatory for employees earning a monthly salary up to Rs 15,000 in companies having 20 or more employees on its roll.
