With the announcement of the unified pension scheme by the Centre for the government employees, now the private sector employees are also expected to receive good news, as there is a proposal to raise the wage ceiling for the calculation of provident fund and pension contributions under the Employees’ Provident Fund Organisation (EPFO).
Reports suggest that the Union Finance Ministry is likely to make a decision on the proposal it received from the Labour Ministry, which recommended raising the wage ceiling to Rs 21,000 from the current Rs 15,000.
The report added that a proposal about increasing wage ceiling for EPF contributions was sent in April and the Finance Ministry will soon take a final decision on this.
It should be noted that the Employees’ Pension Scheme (EPS), managed by the Employees’ Provident Fund Organisation (EPFO), has had a wage ceiling of Rs 15,000 for calculating pensions since September 1, 2014. Notably, this proposed increase could bring much-needed relief and improved benefits to employees.
Once the proposal to increase the wage ceiling from Rs 15,000 to Rs 21,000 is approved, it will help the pension and EPF contributions of private sector employees.
Interestingly, the proposed increase in the EPS wage ceiling to Rs 21,000 would also increase pension amounts, enhancing financial security for retirees.
