Wages Ceiling and Minimum Pension Update: What Do These Changes Mean for You?

Wages Ceiling and Minimum Pension Update

Hopefully, the attachment will be useful for all of our users. The Wages Ceiling has been revised to ₹15,000/- from ₹6,500/-. The Minimum Pension will be ₹1,000/- for subscribers.

Regards

I find the increase is in papers only. Old pensioners who were getting less than ₹1,000/- are still receiving the EPF Pension of less than ₹1,000/-. Nobody is clarifying this for new employees who join the scheme after 1st April 2013 or for old pensioners whose pension was sanctioned in 2002-2003. (My pension was sanctioned at ₹645/- in May 2003, and I have been receiving the same amount until August 2014).

Procedures for Increased Pension for Old Pensioners

If the increase is for old pensioners to receive an increased pension, what procedures do they have to follow? HR sections take care of current employees, but no HR section contacts retired employees.

New rules are applicable from September 14th. You will start receiving your ₹1,000 from either September or October (depending on the interpretation of "effective from September" as whether the pension will be received in the first week of September or October). The UPA had recommended this to be effective from April, but "Ache din aanewala" has postponed it to be effective from September.

You don't have to take any action; EPFO will inform your bank with a copy to you, probably in the form of a new PPO (pension paying order).

Regards

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@Sethi Uncle... Raghavant is right, you have nothing to worry about as you will start receiving your pension in four digits from September '14, which will be paid in October '14.

Two things we have overlooked/missed:

1. Pension amendment is applicable for the year 2014-15 only. Does it mean that every year a notification will be issued?

2. Pensionable salary will be calculated as the average of the last 60 months of service instead of the current 12 months. Employers favoring employees by showing a higher salary for the last 12 months of service may stop now.

With reference to your reply, I would like to inform you that my pension has increased from ₹645 per month to ₹760, not to a minimum of ₹1,000 as declared by the government. No intimation about the increase or how the new fixation has been done has been received. If there is some other calculation method, then I fail to understand why the government (political leaders) declares a minimum pension of ₹1,000 when the EP Pension Office has to follow different rules.

Please note that I worked in a PSU for 36 years and had been paying my contribution to the fund for 36 years. I have been receiving ₹645 per month for the last 12 years. I have been at a disadvantage due to the change in the scheme in 1995. The value of money in the years when I paid the contribution was 10 to 20 times the value today.

As per the scheme, the government is not paying the pensioners the due returns. Pensioners are getting cheated. Pension schemes by LIC or other insurance schemes are also similar.

I suggest to all salaried people not to depend upon the government's pension schemes and instead make their savings and plan to develop their assets/funds for their retired life. This is my personal view. Let the financial experts give their views.

Regards,
PK Sethi