The over 3.2 crore (32 million) subscribers to the provident fund may get a lower 9 per cent interest from April instead of the prevailing rate of 9.5 per cent.

The Central Board of Trustees of Employees Provident Fund Organisation had cut interest on provident fund by 0.5 per cent but granted a golden jubilee bonanza of 0.5 per cent to virtually retain 9.5 per cent for the current fiscal.

With Parliament being dissolved and Election Commission announcing the four-phased polls in the country, the EPFO, whose chairman is the labour minister, cannot take any decision in this regard for the next financial year and therefore, one has to assume that interest rate would be lower at 9 per cent.

"There are chances that the interest rates may be revised after the new government comes in," official sources told PTI in New Delhi.

When asked whether it would mean a downward revision, they did not specify since nothing could be "uttered" because of its possible political ramifications for the polls.

Already there are two views on the interest rates with one school of thought believing if the Centre could introduce higher return bearing instruments like Varishta Pension Bima Yojana and Dada-dadi bonds, then the market certainly would have an "appetite" for it.

The other group, which comprises mainly the financial markets, feels the sustainability of higher returns for the EPFO was "untenable" due to the lower interest rate regime.

Labour Minister Sahib Singh Verma had already indicated a dip in fortunes for EPFO in 2004-05, projecting that income was only set to rise over 4 per cent as compared to over 28 per cent hike in expenditure due to higher resources needed for its "EPFO Re-inventing" programme.

The PF Board had already approved the appointment of a consultant who would look into the investment patterns of the country's largest pension fund and suggest ways to improve the earning capacities.

Though the board had also approved changes in investment patterns, the labour ministry is yet to receive ratification from the finance ministry.

Sources, however, said if there could have been effective recoveries (as EPFO wanted), then it would have offered a solution to a great extent.

Though officials are tight-lipped over the extent of recoveries after EPFO embarked on 'Compliance 2004' to expose the defaulters in public and private sectors, they said a "substantial" amount of dues have been retrieved.