The
Finance Ministry has approved a proposal for providing a minimum
monthly pension of Rs 1,000 to workers in the organised sector, a move
which would benefit 27 lakh pensioners immediately.
The ministry
has also approved a proposal for raising the basic wage ceiling under
the Employees Provident Fund Scheme to Rs 15,000 from existing Rs 6,500
per month.At present, there are about 44 lakh pensioners. Of this 27 lakh, including 5 lakh widows, get less than Rs 1,000 a month.
"The
Finance Ministry has approved the proposal for providing a minimum
monthly pension of Rs 1,000
under the Employees Pension Scheme 1995
(EPS-95) run by EPFO. The ministry also cleared enhancing the wage
ceiling to 15,000 under social security schemes run by the retirement
fund body," an official source said.
The government will provide
additional subsidy of Rs 1,217 crore to ensure the minimum monthly
pension of Rs 1,000 starting 2014-15. Pensioners are, therefore,
expected to get benefit with effect from April 1 this year.
Labour Minister Oscar Fernandes, however, is yet to decide on whether the move requires the Cabinet approval or not.
The
Labour Ministry's proposal on giving a minimum monthly pension of Rs
1,000 under the EPS-95, run by the Employees' Provident Fund
Organisation (EPFO), has been pending for a long time.
Earlier,
the Labour Ministry had proposed that government should increase subsidy
on EPS-95 from 1.16 per cent of basic wage to 1.79 per cent to ensure
minimum pension. However, it did not find favour with the Finance
Ministry as this would have resulted in a permanent increase in subsidy.
The
Labour Ministry in its revised proposal has asked the Finance Ministry
to provide for around Rs 1,217 crore additional amount every year, and
indicated that this amount can come down over a period of time with more
members subscribing to EPS-95.