EPFO Higher Pension Scheme Benefits: Discover Sep. 24 Status

Navigating the complexities of pension applications can be challenging, especially with a large number of retirees seeking clarity on their entitlements. As of August 7, 2024, the Employees’ Provident Fund Organisation (EPFO) has received over 17 lakh applications, with a significant portion belonging to those who were active members as of September 1, 2014. However, not all applications have had a smooth journey—many remain pending with employers, while others face rejections, particularly among pre-2014 retirees. In this blog, we’ll break down the latest updates on pension processing and what they mean for retirees across the country.

What is the EPFO higher pension scheme?

The Higher Pension Scheme from the Employees’ Provident Fund Organisation (EPFO) is a provision that allows eligible employees to receive a higher pension amount upon retirement by contributing more towards the Employees’ Pension Scheme (EPS). Traditionally, pensions under EPS were calculated based on a capped salary of ₹15,000 per month. However, under the higher pension scheme, employees can opt to contribute 8.33% of their actual salary (which may be higher than ₹15,000) towards the pension fund, resulting in a significantly larger pension upon retirement.

This scheme primarily benefits employees with higher salaries who want a pension that better reflects their earnings. To opt for the higher pension, employees and their employers must jointly apply, and the additional contributions are typically backdated, requiring a lump sum payment of the difference in contributions for past years.

The scheme is particularly relevant for those who were members of the EPFO before September 1, 2014, as they are eligible to opt into the higher pension option. However, it has been a subject of various legal and administrative processes, leading to confusion and delays in its implementation.

EPFO Higher Pension Stats

Pension Approvals and Rejections

Approved Pensions:

• Only two pre-2014 retirees were granted a higher pension.
• In contrast, 8,399 members who were part of the EPFO as on September 1, 2014, received higher pensions.

Rejection Data:

• A significant portion of the rejections (1.12 lakh out of 1.48 lakh) affected pre-2014 retirees, indicating a stringent screening process or perhaps eligibility issues for this group.

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Demand Notices Issued

Breakdown of Demand Notices:

• A total of 89,235 demand notices were issued.
• Of these, only 16 were sent to pre-2014 retirees, while the vast majority, 89,219, were issued to members as on September 1, 2014.

Implications for Retirees:

• The fact that such a small number of pre-2014 retirees received demand notices, compared to those who were members as of September 2014, suggests that the EPFO may be focusing more on the latter group for compliance and adjustments.

Pending Applications

Around 3.14 lakh applications are still pending with employers, who have yet to forward them to the EPFO for processing. The EPFO has received approximately 14.3 lakh applications, which are either being processed or awaiting further action

Conclusion and Next Steps

EPFO’s Role:

• The EPFO’s processing and classification efforts are critical in ensuring that eligible retirees receive their due benefits. The data indicates a significant backlog and ongoing issues, particularly with older retirees.

Future Outlook:

• With a large number of applications pending, both with employers and the EPFO, retirees may face delays. The disparity in how pre-2014 retirees and post-September 2014 members are treated might also prompt further scrutiny and possibly policy reviews.

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