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Home Personal Finance Good news for Govt. Employees: Pension amount will increase soon, Know the...

Good news for Govt. Employees: Pension amount will increase soon, Know the complete calculation

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National Pension Scheme: Good news! You will get Rs. 44,793 per month, see how

There is good news for the private sector employees before Diwali. There is going to be an increase in pension soon. 

According to media reports, the Employees’ Provident Fund Organization (EPFO) has fixed the maximum salary of 15 thousand rupees (Basic Salary) for the pension of employees, in such a situation, in the pension (EPS) of lakhs of employees who give Employees Provident Fund (EPF) soon. Can increase up to 300%. For this, the Supreme Court can abolish this salary-limit of EPFO, after which there is a possibility of increase in pension up to 25000 thousand.


According to media reports, the Employees’ Provident Fund Organization (EPFO) has fixed the maximum salary of 15 thousand rupees (basic salary) for the employees’ pension. This means that if the salary of the employee is more than Rs 15 thousand per month, then the calculation of pension will be done only on the maximum salary of 15 thousand rupees. (EPS) can increase up to 300%.

At present, the matter is sub-judice in the Supreme Court and the matter is being heard continuously since August 17 and this matter is still pending. It is believed that now the Supreme Court can eliminate this salary-limit of EPFO. It is expected that soon the final decision will be taken in this matter. If this happens, then PF will be deducted on the maximum amount and pension can be more than 300 percent. The same employees’ pension (Employee Pension Scheme) can also be calculated on the last salary i.e. higher pay bracket, due to this decision the employees will get many times more pension.


Let us tell you that in this case on September 1, 2014, while modifying the Employees’ Pension Scheme, the Government of India had issued a notification, which said that the limit of basic pay should not be fixed for deducting the amount of PF. This decision was strongly opposed by the private sector employees and then the PF department also approached the Supreme Court, at present the hearing in this matter is going on and the decision is expected soon.

Here is the complete calculation

  • For example, at present the salary (Basic Salary + DA) of an employee is 20 thousand rupees. Calculating from the pension formula, it will be Rs 4000 (20,000X14)/70 = Rs 4000 and higher the salary, the more pension benefits he will get, such people can see a jump of up to 300% in their pension.
  • If an employee is working from 1st June 2015 and wants to take pension after completing 14 years of service, then his pension will be calculated on 15 thousand rupees only. The formula for calculation of pension is- (Service History x 15,000/70), but, if the Supreme Court decides in favor of the employees, the pension of that employee will increase.


  • Apart from this, suppose the job of an employee is 33 years and the basic salary is 50 thousand rupees. At present, the pension is calculated only on the maximum salary of 15 thousand rupees. Thus (Formula: 33 Years+2= 35/70×15,000) the pension is only Rs.7,500. After removing the pension limit, adding the pension according to the last salary, they will get a pension of 25000 thousand rupees, ie (33 years + 2 = 35/70 × 50,000 = 25000 rupees).
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