The wait for higher pension under the Employees’ Pension Scheme could be longer than anticipated, as the Employees’ Provident Fund Organisation (EPFO) has not worked out a clear timeframe by when it would be implemented.
The issue is understood to have been taken up at the recent meeting of a sub-committee of the EPFO’s Central Board of Trustees (CBT). Members of the sub-committee on pension implementation and Employees’ Deposit Linked Insurance, in a meeting on March 15, are understood to have asked the EPFO on the status of the implementation of higher pension, based on a Supreme Court ruling, and expressed concerns over the “piecemeal” manner in which it was being done.
The EPFO has set May 3 as the deadline for submitting applications for opting for a higher pension under the EPS. Following this, it plans to individually examine all applications before informing subscribers of their eligibility.
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“Based on the discussion with the EPFO, it does not seem like the implementation of the higher pension will take place any time soon. The process could stretch into months at this rate,” said Harbhajan Singh Sidhu, general-secretary, Hind Mazdoor Sabha, and a member of the CBT, who attended the meeting of the sub-committee.
At present, the EPFO has only provided an online facility for submitting option for higher pension. It will have to provide the method of deposit of such funds by the subscribers. Further, it is also not clear what the financial implications of the higher payout would be and how it would be funded. The EPFO’s revised estimates (RE) for 2022-23 and Budget estimates for 2023-24 also do not seem to reflect this. The estimates will be approved by the CBT in its meeting on March 27 and 28.
The RE for 2022-23 for the Employees’ Pension Scheme has been retained at the BE level of Rs 8,485 crore. The budgetary allocation for 2023-24 has been increased by 8% to Rs 9,167 crore.
Over 0.12 million applications and forms for joint option had been submitted on the online portal of the EPFO by March 9, minister of state for labour & employment Rameshwar Teli informed the Rajya Sabha on March 16. “The total number of beneficiaries in accordance with the directions given in the Supreme Court judgement dated November 11, 2022 will depend upon the employees exercising joint option and the number of such employees who are eligible. The quantum of monthly pension payout for such pensioners will depend upon the number of eligible members exercising the option for pension at higher salary,” he said in response to a question.
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Following the Supreme Court ruling, the EPFO has come out with two circulars. It has sought online applications from pensioners who retired before September 1, 2014 and had exercised joint option for contributing in pension fund on salary exceeding wage ceiling before their retirement, but whose joint options were rejected by the EPFO. It has also sought online joint options from employees who were in service before September 1, 2014 and continued to be in service afterwards as well, but could not exercise the joint option.