The union budget (Union Budget 2026) comes into effect, so some accounts, reports and market speculation all indicate that the central government might at last finally meet the old calls by private sector employees, for redress from the EPS-95 that long-enforced in the country's old labour market (Employees' Pension Scheme 1995).
There is a big word that a big hike could befall the minimum monthly pension, to this day, up to or more than ₹6,000 from the ₹1,000 or up to five times now and to the ₹1,000 level. For more than a decade, millions of retired private-sector workers have been forced into a system with a minimum pension capped at ₹1,000 a month, fixed for 2014.
Considering the steep increase in inflation and medical expenses in the past 11 years, that sum has been widely blamed as ineffectual for good life. Pensioner associations and labor unions have consistently requested a baseline of ₹7,500 plus Dearness Allowance (DA).
What Can Be Expected from the Current Budget For 2026?
The Ministry of Labour and EPFO (Employees' Provident Fund Organisation), however, are now under pressure to declare a relief package in the February budget, if only only to sound the faintest alarm and then get their relief package released soon as well.
Proposed Hike
Reports have said that the government may finally agree on a minimum pension of ₹6,000 a month.
- Date of the actual implementation: Although the announcement may occur in the 2026 Budget, the actual rollout is to start in the new financial year beginning April 1, 2026.
- Scope: If widely seen, this hike would deliver immediate benefits to more than 75 lakh pensioners across India who are presently paying very little monthly.
The Challenges Involved
The news offers optimism, but the state has a whopping "Actuarial Deficit" in the pension fund. Raising the minimum pension will also need a significant budget burden from the central government since it currently contributes 1.16% of the wages (up to a ceiling of ₹15,000).
Experts estimate that increasing the pension to ₹6,000 will cost the exchequer another ₹3,000 to ₹5,000 crore annually. The demand for ₹7,500 remains. Notwithstanding the excitement surrounding the figure of ₹6,000, the National Agitation Committee (NAC) for EPS-95 is still defending its primary demands:
- Base Pension: ₹7,500 a month.
- Health: Medical services for all pensioners, as well as, their spouses.
- DA Connectivity: Connecting the pension to the consumer price index to tame inflation.
Note: This data is taken from popular media reporting and speculative pre-budgeting. Government notification has not been issued yet. See official EPFO or Ministry of Labour websites for confirmed updates
