EPFO update: The long-standing demand of EPS-95 pensioners covered under the Employees’ Provident Fund Organisation (EPFO) for a higher minimum pension once again came up in Parliament during the ongoing Winter Session.
In an Unstarred Question answered in the Lok Sabha on December 1, 2025, the government clarified its position on increasing the minimum pension and granting Dearness Allowance (DA) to pensioners under the Employees’ Pension Scheme, 1995 (EPS-95).
The question was raised by MP Balya Mama Suresh Gopinath Mhatre, who sought clarity on whether the government was considering raising the minimum pension from Rs 1,000 to Rs 7,500. This demand has repeatedly been made by lakhs of pensioners across the country for many years now.
A decades-old demand that remains unresolved
EPS-95 is India’s largest pension scheme for private-sector and organised-sector workers, covering more than 80 lakh pensioners. Introduced in 1995, the scheme was designed as a defined contribution–defined benefit social security system, where pension payouts come from:
a. 8.33% of the employee’s wages contributed by the employer
b. 1.16% contribution from the central government (up to Rs 15,000 wage ceiling)
Although the scheme was meant to ensure old-age security, pensioners have long argued that the Rs 1,000 minimum monthly pension, introduced in 2014, has not kept pace with rising prices, cost of living or inflation.
For nearly a decade, EPS-95 pensioners’ organisations have consistently demanded:
-Increase in minimum pension to Rs 7,500 – Rs 9,000
-Regular Dearness Allowance (DA)
-Restoration of higher pension benefits
-A revision of the scheme to make pensions livable
Thousands of pensioners have held marches, dharnas and written petitions to the government, saying the current amount is too low to survive with dignity.
What the MP asked the government
The parliamentarian asked six key questions:
Is the government planning to raise the minimum pension to Rs 7,500?
If not, why?
Why is DA not given to EPS-95 pensioners even as inflation rises?
Is the government taking steps to make the pension amount suitable for living?
Has the government taken note of pensioners’ demands?
If yes, what action has been taken?
Government’s reply: No such plan right now
The Minister of State for Labour and Employment, Shobha Karandlaje, responded with a detailed explanation of the scheme’s financial constraints.
No proposal to raise pension to Rs 7,500
The government did not say it is considering raising the minimum pension at present.
Fund has an actuarial deficit
As per the last valuation of the EPS Fund (as of March 31, 2019), the scheme runs an actuarial deficit — meaning the fund’s current contributions are not sufficient to meet all future pension liabilities.
Because of this financial stress, the government argues that raising the pension amount without a fresh funding model could worsen the deficit.
Minimum Rs 1,000 pension continues with budgetary support
The government currently provides budgetary support to ensure the minimum monthly pension of Rs 1,000. This is in addition to its long-standing contribution of 1.16% of wages for every EPS member.
What about Dearness Allowance?
The Minister did not commit to any DA for EPS-95 pensioners. Since the scheme is based on a defined contribution and not a pay-linked structure like government pensions, DA is not part of the EPS framework.
Acknowledgement of pensioners’ demands
The government said it is “committed to ensuring maximum benefits” to workers but must also factor in fund health, long-term sustainability, ad future liabilities.
The reply stops short of promising any concrete steps or timelines.
Why the EPS-95 issue keeps returning
EPS-95 pensioners constitute one of the largest groups of retirees in India, and their financial hardships are well-documented. Many retired workers—especially from lower-wage sectors—depend entirely on this pension.
The demand for a higher minimum pension gained fresh momentum after rising inflation, increased medical expenses, higher cost of living, and parallels with government employees receiving DA and periodic pay revisions.
However, without major changes in funding—either higher employer contributions, more government support, or re-structuring—raising the minimum pension remains financially difficult under the current EPS design.