This new scheme will be for such employees of the organized sector, whose basic salary is more than Rs 15,000 and who are not compulsorily covered under the Employees’ Pension Scheme-1995 (EPS-95).
EPFO: The Employees’ Provident Fund Organization (EPFO) is contemplating to bring a new pension scheme for organized sector employees. This new scheme will be for such employees of the organized sector, whose basic salary is more than Rs 15,000 and who are not compulsorily covered under the Employees’ Pension Scheme-1995 (EPS-95). At present, those employees of the organized sector whose basic salary (Basic Pay and Dearness Allowance) is up to Rs 15,000 are compulsorily covered under EPS-95. According to sources, “There has been a demand for more pension on higher contribution among the members of EPFO. In this way, a new pension scheme is being considered for those people whose monthly basic salary is more than Rs 15,000.
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The proposal will be discussed in March
The proposal of this new pension scheme will be discussed in the meeting of the Central Board of Trustees (CBT), the decision-making body of EPFO, in Guwahati on March 11 and 12. During the meeting, a sub-committee on pension related issues constituted by the CBT in November, 2021 will also submit its report. The source said that there are EPFO subscribers who are getting a monthly basic salary of more than Rs 15,000, but they are able to contribute only at a lower rate of 8.33 percent under EPS-95, thus they get less pension.
50 lakh more employees may come under the purview of EPS-95
As per estimates, 50 lakh more workers in the organized sector may come under the purview of EPS-95 by raising the pensionable salary. The EPFO had amended the scheme in 2014 to limit the monthly pensionable basic pay to Rs 15,000. The limit of Rs 15,000 is applicable only at the time of joining the service. It was revised upwards from Rs 6,500 with effect from September 1, 2014, due to wage revision and price hike in the organized sector. Later, there was a demand to increase the monthly basic salary limit to Rs 25,000 and it was considered, but the proposal could not be approved.
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Former Labor Minister Bandaru Dattatreya said in a written reply in Lok Sabha in December 2016, “Proposal to increase the wage ceiling for ‘coverage’ from Rs 15,000 per month to Rs 25,000 per month under the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952.” EPFO had introduced, but no decision was taken on it. The source said that there is a need for a new pension scheme for those who are either forced to contribute less or who could not subscribe to the scheme as their monthly basic salary at the time of joining the service was more than Rs 15,000. .
(Input-PTI)
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