Union Minister Oscar Fernandes, flanked by Labour Commissioner K.M. Sahini (right) and CPF Commissioner Vishwanathan, addresses the press after a meeting of the Central Board of Trustees of the Employees Provident Fund in New Delhi on Tuesday. — Photo: Rajeev Bhatt

NEW DELHI: The Central Board of Trustees of the Employees Provident Fund Organisation (EPFO) on Tuesday deferred a decision on fixing the rate of interest for the Employees Provident Fund for 2006-07.

"The members, representing the employers, the employees and the Government, expressed their views during the meeting and the Board directed that the details of income and fund may be re-examined to find out whether any distributable surplus is available," Minister of State (Independent charge) Oscar Fernandes told reporters after a meeting on Tuesday.

The interest rate issue will be taken up at the next Board meeting before December 10.

While the Labour Ministry maintains that the current rate of interest (8.5 per cent) was not tenable, as it would leave a deficit of Rs. 450 crore for the organisation, the unions oppose any reduction, arguing that re-examination of funds would yield the required amount.

The EPFO last year slashed the interest rate from 9.5 per cent to 8.5 per cent but had to utilise Rs. 350 crore from its reserve fund.

The organisation from its own earning can pay only 8 per cent.

"The Board will go into the details of the funds and also wait for the final report of the EPFO's sub-committee on finance that is expected to be presented within two weeks before a final decision is taken," Mr. Fernandes said.

The Board is seized of the financial position of the EPFO and it would be taken into consideration at the next meeting, he added.

The Board also discussed at length the structural adjustments required in the Employees Pension Scheme, 1995, and the changes to be made in the existing scheme.

``After thorough discussions, the Board felt that the matter required further deliberations and decided to meet the representatives of the central trade unions within a week," Mr. Fernandes said.

Other issues, such as simplification of procedure for grant of exemption in view of the recent amendment in income tax law relating to Provident Fund Trusts, waiver of damages in respect of certain establishments, and issues relating to physical facilities were considered and decisions taken.

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