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The transfer is geared toward bringing EPS-95 on a par with the Nationwide Pension Scheme to reinforce the retirement choices.
The labour ministry additionally plans to open the EPS to all people whereas enhancing the minimal pension to Rs 3,000 based mostly on the contribution by people.
At current, all EPFO subscribers are enrolled beneath EPS with contributions to the pension account capped on the wage of Rs 15,000. This prohibits high-salaried people to reinforce their retirement kitty beneath EPS and as an alternative go for different retirement schemes provided by personal gamers or the NPS.
“Varied modifications are being thought of to make the scheme complete whereas increasing its subscriber base,” a senior authorities official informed ET. The modifications, nevertheless, might be introduced in after the implementation of the Social Safety Code, 2020.
In response to the official, who spoke on the situation of anonymity, the labour ministry can be considering to change the funding sample of the pension pool to maximise returns because the nation strikes in the direction of outlined contributions.
This might be a departure from the prevailing scheme beneath which the pensioners are given pension from the pooled account through which 8.33% of the worker’s pay is contributed by the employer and 1.16% of the worker’s pay is contributed by the central authorities.
At present, there are six million EPS subscribers and the federal government goals to reinforce the subscriber base to 10 million over the following few years.
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