Cabinet raises EPFO wage ceiling to Rs 25,000, expanding coverage
The Union Cabinet approved increasing the Employees’ Provident Fund Organisation wage ceiling from Rs 15,000 to Rs 25,000 per month, potentially adding over 51 lakh workers to mandatory coverage.
On Wednesday, the Union Cabinet gave the green light to the Ministry of Labour & Employment’s plan to raise the Employees’ Provident Fund Organisation wage ceiling from Rs 15,000 to Rs 25,000 per month. By extending mandatory coverage to workers earning up to Rs 25,000, the reform could enroll more than 51 lakh new employees in the EPF, EPS and EDLI schemes, enhancing their retirement savings and insurance protection. The ceiling had last been adjusted in September 2014, and the increase aims to align the statutory framework with rising wages and expanding formal jobs.
Officials anticipate the move will support formalisation, improve worker retention and boost morale. Fiscal projections show the revised arrangement will cost roughly Rs 11,339 crore annually, compared with the existing Rs 10,250 crore, amounting to about Rs 56,696 crore over five years. Current EPFO data indicate nearly 7.98 crore members across 7.68 lakh establishments, with EPS serving around 82 lakh pensioners.
Why it matters
Expanding EPFO coverage strengthens retirement security for millions of Indian workers and signals a push toward greater formal employment.
How the sides frame it
HIGH AGREEMENTBoth camps report the same policy change and its expected benefits, with only minor wording differences; overall coverage is consistent.
LEFT
The increase is presented as a step to align the wage ceiling with rising incomes and to promote further formalisation, enhance retirement security, and broaden access to statutory benefits.
CENTER
The raise is portrayed as aligning the statutory framework with higher wages, supporting formalisation, improving worker retention and morale, and noting the fiscal cost of the reform.
The left emphasises
- align the ceiling with sustained wage increases
- promote further formalisation of the labour market
- enhance long-term retirement security
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