Mukherjee to take final call on additional 1% provident fund interest
15 Mar 2011
Unconvinced by the labour ministry's claims for an additional 1 per cent interest on provident fund deposits in 2010-11, the finance ministry has referred the matter to finance minister Pranab Mukherjee for a final decision.
Citing an unnamed source in the finance ministry, The Indian Express reported that it was now up to the minister to decided whether the 9.5 per cent interest rate should be notified. The source said the ministry's only concern was that the additional interest should not be paid from government coffers, especially in the backdrop of the CAG report terming EPFO's so called surplus unverifiable.
The ministry is required to decide on the issue by 31 March, as the Employees' Provident Fund Organisation has to start crediting interest and hand out account slips to its 4.7 crore subscribers from April.
In the absence of a formal notification from the finance ministry, subscribers would not be given the higher interest rate. The labour ministry has been pushing the matter with the finance ministry for ratification of the decision by Central Board of Trustees of the EPFO to provide a 9.5 per cent return on retirement savings in 2010-11 with its finding a surplus of Rs1,371 crore.
The finance ministry has however repeatedly questioned the basis on which the surplus has been calculated.
Citing an unnamed source in the finance ministry, The Indian Express reported that it was now up to the minister to decided whether the 9.5 per cent interest rate should be notified. The source said the ministry's only concern was that the additional interest should not be paid from government coffers, especially in the backdrop of the CAG report terming EPFO's so called surplus unverifiable.
The ministry is required to decide on the issue by 31 March, as the Employees' Provident Fund Organisation has to start crediting interest and hand out account slips to its 4.7 crore subscribers from April.
In the absence of a formal notification from the finance ministry, subscribers would not be given the higher interest rate. The labour ministry has been pushing the matter with the finance ministry for ratification of the decision by Central Board of Trustees of the EPFO to provide a 9.5 per cent return on retirement savings in 2010-11 with its finding a surplus of Rs1,371 crore.
The finance ministry has however repeatedly questioned the basis on which the surplus has been calculated.