Hopes are high for around 78 lakh pensioners as they look forward to this year’s festive season. Currently, pensioners are housed under the Employees Pension Scheme EPS-95. With the festive season slowly nearing, they might also be looking forward to a festive gift. In this, the EPS-95 pensioners are looking forward to a significant pension hike, which, if announced, could help alleviate the burden of rampant inflation, which has made the cost of living increasingly troublesome to manage. With the EPS-95 pension scheme under the pensioners’ heart, literally ‘the masala of this pakoda is certain’ (the festive season for them will certainly be remarkable).
Landmark Reforms For Pensioners
Private sector employees can access monthly pensions through the EPS-95 scheme which was initiated in 1995 by the Employees’ Provident Fund Organisation (EPFO). The scheme has faced criticism for a long time due to the absolute lack of a raised minimum pension cap which has been stuck at 1000 rupees for years. It was a long-awaited Supreme Court decision in 2025 which raised the monthly cap to 7500 rupees which certainly is a relief to the pensioners. Pensioners have long struggled during the time of inflation. (https://kord.in/eps-95-pension-hike-announced-%25E2%2582%25B97500-monthly-pension-effective-may-2025/)
Dearness Allowance Brings New Hope
One of the biggest highlights of the reform is the inclusion of Dearness Allowance (DA). This inflation-indexed component pays out relative to the All India Consumer Price index (AICPI) ensuring that pensions are reviewed and raised twice a year. With the implementation of DA EPS-95 will be in line with government employees allowing for better financial planning for the pensioners. The inclusion of EPS-95 on par with government employees marks a notable move.
Pre-Budget Talks Fuel Expectations
The EPS-95 National Agitation Committee met with Finance Minister Nirmala Sitharaman on 10 January 2025. During the meeting, the committee vouched for a pension increase to ₹7,500, with dearness allowance and surgery treatment free of cost. Sitharaman promised to reconsider, bolstering the likelihood of an EPS-95 pension announcement before the Union budget which will be revealed on 1 February 2025.
Pensioner Action Plan
The retirees are instructed to remain vigilant. It is essential to update Aadhaar and bank details with EPFO to avoid interruptions in payment. The Supreme Court’s order guarantees the relaxed rule of no reapplication leads to easier processes for retirees.
Table: Key Details Of EPS-95 Pension Hike
| Aspect | Details |
|---|---|
| Current Minimum Pension | ₹1,000 per month |
| Proposed Minimum Pension | ₹7,500 per month, effective May 2025 |
| Dearness Allowance | Inflation-linked, revised biannually via AICPI |
| Beneficiaries | Approximately 78 lakh pensioners |
| Implementation | Immediate rollout ordered by Supreme Court, no reapplication needed |
| Challenges | Actuarial deficit, potential strain on public finances |
| Evaluation Timeline | Third-party evaluation by Labour Ministry, expected completion by Dec 2025 |
A Step Toward Dignified Retirement
The earmarked increase to ₹7,500 along with DA inclusion is a leap towards dignified retirement. Though there are concerns with budgetary strain and fund stability, the government’s review progress coupled with the Supreme Court’s advocacy is a good sign. Pensioners need to be vigilant via the EPFO portals, as the festive season might be a financially rewarding time.
Also Read: Income Tax Rules 2025: Key Changes Taxpayers Should Know