The Employees’ Pension Scheme (EPS) is the most important social security benefit for employees of the organised sector in India. The scheme is administered by the Employees’ Provident Fund Organisation authorities such that after retirement, employees receive a pension every month, which secures them financially.
What Is the Minimum EPS Pension?
Minimum pension of ₹1,000 is assured by EPS to those members who are eligible. This minimum pension amount came into effect for the benefit of lower-income employees who contributed to the EPS but could not achieve enough service years or salary credits to get a higher pension.
Eligibility Criteria
To qualify for an EPS pension, the scheme demands a subscription period of at least 10 years before the applicant turns 58 years. Eligible candidates who have completed the stipulated period of service may apply for pension benefits after retirement. It is possible to get an early pension from the age of 50 with a proportionate reduction.
Pension Calculation
The monthly pension under EPS is calculated by the formula:
Pension = (Pensionable Salary × Pensionable Service) ÷ 70
Still, the minimum payment being ensured by the Government for contributors with lesser service does not fall below ₹1,000 per month.
Benefits of the Scheme
EPS offers an assured lifetime pension to its members; in return, an assured flow of income will be generated for the retired ones. It provides family pension benefits to dependents in case of death of the member, thereby financially securing both spouse and children.
Recent Updates and Demand for Increase
While 1,000 rupees are the present minimum pension, employee unions and retirees have demanded an increase in this amount to at least 3,000 rupees considering inflation and rising costs of living. The negotiations continue, and a change is expected to be announced by the government in due course.
Conclusion
This minimum EPS pension scheme constitutes an essential safety net for millions of workers who comprise India’s organised sector. Employees must undertake to ensure that their EPS contributions are diligently remitted and that they procure an updated record from the EPFO, so as not to find themselves in difficulty when claiming the benefits after retirement.
