The Organization for Occupational Welfare (EPFO) will pay a monthly pension to its 6.5 million account holders before the end of March, to help subscribers cope with the COVID-19 coronavirus epidemic .
“Due to the corona virus pandemic, a lockout has been declared in various parts of the country. In order to ensure that no inconvenience is caused to retirees due to the current situation, (the) Central Provident Commissioner (EPFO) asked the field offices to generate and reconcile the details of the retirees and the statements of amounts pension for the month by March 25, 2020, “said a statement on Monday from the Ministry of Labor and Employment.
He added that the CPFC of the EPFO, Sunil Barthwal, had ordered officials to send it to the banks “so that the monthly pension is credited to the retirees account on time, that is to say during the month of march itself “.
An official explained that EPFO usually sends details of pension disbursements to banks on the last working day of the month (in this case, it would have been March 31). The annuity is credited to the subscriber’s account the first week of the following month. This schedule has been brought forward now.
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Earlier this month, EPFO released a statement asking subscribers to take advantage of online facilities, including for their contingency fund requests. Government offices have operated with skeletal personnel to prevent the spread of the COVID-19 virus. Many private offices are closed or have asked their employees to work from home.
EPFO manages three plans for workers in the private sector: the employee benefit plan, the employee pension plan (EPS) and the employee deposit insurance scheme.
Employees contribute 12% of their salary (base salary and high cost allowance) to these plans, with an equivalent contribution of 12% from employers. Of this amount, 8.33% of the employers ‘share goes to the EPS and the government also pays 1.16% of the salary to the workers’ pension account.
Currently, 8.33% of the salary, up to 15,000 rupees per month, is paid into a worker’s EPS account. Workers earning more than 15,000 rupees a month who joined the EPFO schemes after September 1, 2014 do not have a pension account.
The EPS fund is a joint account with the EPFO for defined benefits for all beneficiaries who receive a pension after the age of 58, provided that they have completed at least 10 years of service.
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Under the EPS, workers receive a monthly pension from the age of 58 until death. The amount of the pension is based on a formula according to which the insured salary corresponds to the monthly basic salary plus the average high cost allowance over the last 60 months of service of a worker.
After taking power during its previous mandate, the government of the National Democratic Alliance (NDA) had announced a minimum monthly pension of 1,000 rupees to all plan subscribers, as of September 2014. This decision benefited approximately 1 , 8 million retirees each year.