The Centre has ruled out, for now, any increase in the minimum monthly pension under the Employees' Pension Scheme (EPS) despite a long-standing demand to raise it to ₹7,500 along with dearness allowance (DA). According to reports from Business Standard, Union Minister of State for Labour and Employment Shobha Karandlaje responded to queries in Parliament, stating that the government has not announced any proposal or timeline to increase the minimum pension beyond the current ₹1,000 per month. The minister emphasized that the government remains committed to strengthening social security for EPFO subscribers while balancing the financial sustainability of the pension fund and its future liabilities. On July 23, 2026, MP R Girirajan questioned the Rajya Sabha about whether the government was thinking of implementing a 'minimum pension scheme for all' to help older people, especially elderly and impoverished women. Karandlaje responded that there is no such intention to introduce the minimum pension program, clarifying that the government's focus remains on existing pension schemes rather than universal welfare programs.
As reported by The Economic Times, EPFO has taken action to implement the directions contained in the Hon'ble Supreme Court Judgment dated 04.11.2022 in a time-bound manner. The minister stated that an online facility was provided and applications for validation of Joint Options processed in accordance with applicable provisions. Vide circular dated 18.01.2025, EPFO issued clarification to facilitate uniform implementation, with eligibility for higher pension benefits determined on the basis of extant trust rules of exempted establishments prevailing before the decision dated 04.11.2022.
The Employees' Pension Scheme, 2026, notified under the Code on Social Security, 2020, has replaced the Employees' Pension Scheme, 1995, and the Employees' Family Pension Scheme, 1971. According to Business Standard, although the structure of the pension scheme largely remains the same, the new framework introduces several administrative improvements aimed at making pension processing faster and more accountable. Key changes include pension claims to be settled within 20 days, pensioners entitled to 12% annual interest if claim settlement is delayed beyond the prescribed timeline, provisions relating to higher pension incorporated into the scheme, and employers having greater digital compliance obligations. The scheme has been renamed as Employees' Pension Scheme, 2026.
Contrary to concerns among EPFO subscribers, the monthly pension under EPS 2026 will continue to be calculated using the existing formula: Monthly pension = (Pensionable salary × Pensionable service) ÷ 70. As reported by Business Standard, this means pension entitlement will continue to depend on an employee's pensionable salary and the number of years of pensionable service, with no change in the calculation methodology. The government's latest clarification means there will be no immediate increase in the minimum monthly pension, despite continued demands from employee unions and pensioners' associations. For existing EPS pensioners, the minimum pension will continue at ₹1,000 per month, even as the new EPS 2026 framework brings procedural changes aimed at improving overall pension delivery.
As reported by Zee News, the Government is providing a minimum pension of ₹1,000 per month to pensioners under the EPS, 1995 through budgetary support, which is in addition to the budgetary support of 1.16 per cent of wages provided annually towards EPS to Employees' Provident Fund Organisation (EPFO). The Employees' Pension Fund is built through employer contribution of 8.33% of wages towards the pension fund and central government contribution of 1.16% of wages, subject to a wage ceiling of ₹15,000 a month. Minister Karandlaje clarified that this budgetary support is separate from the annual 1.16% wage contribution made by the government towards EPS, which is managed by EPFO. The government noted that the minimum pension of ₹1,000 is supported through budgetary assistance, in addition to its regular contribution to the pension fund.
According to the latest parliamentary clarification, the establishment of a Social Security Fund to fund welfare programs for qualified employees is mandated by the Code on Social Security, 2020. The minister emphasized that the Code also provides for setting up a Social Security Fund to finance the welfare scheme, with unorganised workers, gig workers, and platform workers able to register under Section 113 of the Code on Social Security, 2020. As of March 31, 2026, there were ₹9,330.56 crores in outstanding EPF accounts under paragraph 72(6) of the EPF Scheme, 1952 (since replaced by paragraph 55 of the EPF Scheme, 2026). This represents the total amount of Employees' Provident Fund held in inactive accounts, highlighting the scale of unclaimed pension benefits that could potentially be channeled into the proposed Social Security Fund.
