The Hindu : National : `EPF rate will be hiked if there is surplus fund'

Online edition of India's National Newspaper
Wednesday, Aug 18, 2004

National

National

`EPF rate will be hiked if there is surplus fund'

By Our Special Correspondent

NEW DELHI, AUG. 17. Attacked by the Left parties for slashing the employees provident fund (EPF) rate to 8.5 per cent, the Government today held out an assurance in the Lok Sabha that it would not hesitate to raise the interest rate provided there was surplus fund available by the end of the financial year.

"No final decision has been taken in this regard... if there is surplus fund, then there will definitely be no hesitation on our part to raise the interest rate," said the Union Labour Minister, Sis Ram Ola, asserting that the interest rate has been fixed at 8.5 per cent only on an interim basis.

The Minister was replying to a brief debate on a calling attention notice by the Communist Party of India (CPI) leader, Gurudas Dasgupta. Members belonging to the Left parties lashed out at the Government accusing the Minister of taking the "unilateral" decision "harming" the interest of lakhs of workers for whom this was the only social security.

Accusing the earlier NDA government of reducing the EPF rate from 12 per cent to nine per cent, Mr. Dasgupta said, "the legacy of the NDA Government is being followed by the present Government."

`Job of Finance Ministry'

Taking exception to the remarks by the members belonging to Left parties and seeking to push the ball in the Finance Ministry's court, Mr. Ola said: "Who am I to increase or decrease the interest rate? This is the job of the Finance Ministry which has pegged it at eight per cent."

He said the interim 8.5 per cent interest rate would leave a deficit of Rs.206 crores. The Provident Fund Commissioner had been asked to take urgent steps to recover the PF dues so that the deficit could be bridged.

Asserting that the Government was determined to protect the interest of workers, Mr. Ola said he had written to the Finance Minister to consider raising the interest on Special Deposit Scheme.

Even the 9.5 EPF interest rate for 2002-03 was on an "ad hoc" basis, as the Finance Ministry had still not ratified it. The nine per cent interest plus 0.5 per cent bonus for 2003-04 was also on an ad hoc basis.

He said the finance committee of the Central Board of Trustee of the Employees' Provident Fund had been asked to inform the Labour Ministry before the end of the financial year of any surplus funds. The Government would be willing to distribute it among the subscribers.

"We will not hesitate in giving this to workers by way of interest," he said conceding that the recommendation of the Central Board of Trustees was unanimous this time, as the consensus could not be reached.

Printer friendly page
Send this article to Friends by E-Mail

National