The Employees’ Provident Fund Organisation (EPFO) finds merit in considerably increasing the retirement age in India and matching it with life expectancy in order to maintain the sustainability of the country’s pension system and give suitable retirement benefits.
By 2047, India is expected to become an ageing society, with an estimated 140 million individuals over the age of 60. This is anticipated to exert enormous strain on the country’s pension funds.
Increasing the retirement age in the future may be considered in accordance with the experiences of other nations and will be essential to the viability of pension systems. The vision paper has been distributed to the states, and negotiations with other stakeholders, including companies and employees, will shortly commence.
Over 12 lakh crore in pension and provident fund assets are held by EPFO on behalf of its almost 60 million subscribers. This comprehensive strategy would likely involve the Pension Fund Regulatory and Development Authority, which manages the government’s National Pension Scheme.
In India, the retirement age ranges between 58 and 65 years, depending on whether the employer is in the public or private sector. However, the retirement age in the European Union is 65, whereas it is 67 in Denmark, Italy, and Greece, and 66 in the United States. The majority have an ageing population.
In the 2012 edition of its ‘Pension Outlook’, the Organisation for Economic Co-operation and Development stated that governments will need to progressively raise retirement ages to account for rising life expectancy in order to maintain viable and appropriate national pension systems.