Sources suggest that the pension scheme will be given a massive boost, the government being reportedly set to increase pension payouts by up to 7 times the existing amount. A corresponding dearness allowance (DA) hike is also expected for retired employees, thereby giving them some reliefs from monetary strife.
Massive Pension Hike: What To Expect?
As of now, many retired persons receive a minimum pension of ₹1,000 per month, which has been widely debated and said to be an unworthy sum really in today’s world. But the proposal at hand aims to up this amount to a maximum of ₹7,500 per month, which translates to 700% up in pensions.
The expected beneficiaries of the scheme are enough in number to be referred to as lakhs of retired employees. In particular, the measures will be applied to those covered [by the] Employees’ Pension Scheme (EPS-95) and other government-backed pension plans. Implementation of this plan would, therefore, refer to that historic increase where pensioners would have an upper hand support against increase in living and inflationary parameters.
Big DA Hike Coming Soon
In addition to this, before Holi 2025, DA hike announcements will be made. According to sources, a 4% hike is going to be made in Dearness Allowance (DA), which will contribute directly to:
- Central government employees.
- Pensioners having DA-indexed pensions
- State government employees (depends upon approval of the states)
A 4% increase in DA, thus, would mean an increase in the monthly payout to the employees and pensioners, increasing their financial security.
Why Is The Government Increasing Pension And DA?
The reasons behind this decision to increase pensions and DA include:
- Inflation and rising cost of living – Retirees are witnessing an upswing in expenses.
- Long-standing demands with pensioners – EPS-95 pensioners have been clamoring for years to increase pension.
- Upcoming elections – Likely to be part of welfare measures from the government.
- Economic growth – A higher pension and DA will stimulate consumption and hence benefit the economy.
Who Will Benefit From The Pension And DA Hike?
- Retired government employees under EPS-95 and other schemes.
- Pensioners receiving DA-linked benefits.
- Private sector employees covered under EPFO pension plans.
Conclusion
If approved, the pension hike of up to 7 times and a 4% DA hike would bring massive relief to retired employees. Implementation, which is expected before Holi 2025, therefore, offers a brighter future for pensioners with monetary stability and a good standard of living.
Also Read: Retirement Age Hike: Government Employees’ Retirement Age Increased, Big Update!