EPS-2026 replaces EPS-95: Does the ₹1,000 minimum pension continue? Here's what has changed

The Centre has notified the Employees' Pension Scheme (EPS), 2026, under the Code on Social Security, 2020, replacing the older EPS, 1971, and EPS, 1995. While the new framework introduces several administrative changes, most of the key pension provisions remain unchanged.

The minimum monthly pension under EPS has long been fixed at ₹1,000. With the notification of EPS-2026, many subscribers may be wondering whether the government has revised this amount. Here's what the new scheme says.

Minimum pension amount under EPS remains unchanged

The government has not announced any hike in the minimum monthly pension under EPS-2026. The scheme continues to provide the same monetary benefit of ₹1,000 per month, which has been in force since September 1, 2014.

Pensioners' associations and labour unions had repeatedly demanded an increase to the minimum pension which would align with inflation and rising living costs.

In recent months, several media reports had suggested that the Labour Ministry was considering a proposal to increase the minimum EPS pension above ₹1,000. However, the newly notified EPS-2026 does not provide for any such revision.

Pension calculation formula remains unchanged

The formula used to calculate monthly pension also remains the same under EPS 2026. The monthly pension will continue to be calculated as:

Monthly Pension = (Pensionable Salary × Pensionable Service) ÷ 70

Pensionable salary will continue to be the average monthly salary received by an employee during the last 60 months before a member exits the pension fund. This means existing subscribers should not expect any change in the way their monthly pension is computed.

Who will be covered under EPS 2026?

The new scheme applies to the following categories of people:

• Employees who become members of the EPF Scheme, 2026 and whose wages are within the notified wage ceiling.
• Existing members covered under EPS-95 or the Employees' Family Pension Scheme, 1971.

A member will continue to remain covered under the scheme until attaining the age of superannuation, withdrawing benefits, becoming eligible for pension or in the event of death.

Contribution pattern remains unchanged

The contribution structure under the scheme also remains the same. The employer will continue to contribute 8.33% of wages, subject to the prescribed wage ceiling, towards the pension fund.

Meanwhile, the government will continue contributing 1.16% of wages, subject to the applicable wage ceiling.

Employees who exercised the higher pension joint option under the earlier EPS-95 scheme will continue to receive benefits under the existing higher pension provisions, which have now been incorporated into the new scheme.

What's new in EPS 2026?

Even though the pension benefits under the latest framework remain unchanged, the new scheme has introduced several improvements to how it operates, which are aimed at making the system more efficient for subscribers:

• All pension claims must be settled within 20 days.
• If EPFO delays the settlement of a pension claim beyond the prescribed timeline, it will pay interest at 12% per annum. The interest amount will be recovered from the salary of the Commissioner responsible for the delay.
• Higher pension provisions have now been formally incorporated into the scheme.
• EPS-2026 places increased emphasis on digital compliance and online processing, enabling employers and subscribers to complete more pension-related procedures electronically.

The notification of EPS 2026 brings administrative changes rather than increasing the benefits for subscribers. The reforms have introduced a digital-first system to improve transparency, speed up claim processing, and modernise retirement benefit services under new social security schemes.