Government Considers Increasing EPFO Minimum Pension to ₹5,000 for Private Sector Employees

Significant Pension Increase on the Horizon

New Delhi, January 7, 2026: A promising development may be on the way for millions of employees in the private sector and retired pensioners. The central government is reportedly contemplating raising the minimum monthly pension under the Employees' Provident Fund Organization (EPFO) from the current ₹1,000 to ₹5,000. If approved, this change could greatly enhance the post-retirement lives of countless private sector workers.

Currently, the minimum pension under the Employees' Pension Scheme (EPS-95) stands at just ₹1,000 per month, which is considered inadequate in today's inflationary climate. Trade unions and pensioners' associations have long advocated for an increase. Recently, during the preparations for the 2025-26 budget, unions made a strong case to Finance Minister Nirmala Sitharaman for raising the minimum pension to ₹5,000.

Who Will Benefit?

• All private sector employees registered with EPFO.


• Those who have completed at least 10 years of service.


• Retired employees currently receiving the minimum pension and their families.

According to government sources, the Ministry of Labour is actively working on this proposal. If it receives approval, the changes could be implemented soon, providing significant relief to senior citizens, widows, and disabled pensioners.

Officials from EPFO have stated that increasing the pension will not only strengthen the financial status of retired employees but also encourage current employees to contribute more to their provident funds.