Retirement fund body EPFO's apex decision making body Central Board of Trustees (CBT) is likely to decide rate of interest on PF deposits for 2012-13 in its meeting scheduled on January 15.
Ahead of the crucial CBT meet, the Employees' Provident Fund Organisation's advisory body Finance and Investment Committee will firm up its view on the matter.
For the sixth year in a row, over 4.7 crore (47 million) subscribers of retirement fund manager EPFO are likely to get 8.5 per cent interest on their deposits in the current fiscal.
The trustees would meet at the regional office of the EPFO in Bengaluru, the capital of the Labour Minister Mallikarjun Kharge's home state Karnataka.
Retirement fund body EPFO is likely to approve this month a proposal to enhance its investments in equites to up to 20 per cent of the investible deposits from the current limit of 15 per cent. The proposal is expected to be considered and approved during the EPFO trustees' meeting scheduled to be held on July 29 and 30, according to a source. At present, EPFO can investment 5 to 15 per cent of the investible deposits in equity or equity-related schemes.
The government has approved 8.1 per cent rate of interest on employees' provident fund (EPF) deposits for 2021-22 -- an over four-decade low -- for about five crore subscribers of retirement fund body EPFO. Earlier in March this year, the Employees' Provident Fund Organisation (EPFO) had decided to lower the interest on provident fund deposits for 2021-22 to 8.1 per cent from 8.5 per cent provided in 2020-21. According to an EPFO office order issued on Friday and reviewed by PTI, the Ministry of Labour and Employment has conveyed approval of the central government to credit 8.1 per cent rate of interest for 2021-22 to each member of the EPF scheme.
The Central Board of Trustees, which is the apex decision-making body of the Employees' Provident Fund Organisation, met on Monday and approved the interest rate.
Over five crore provident fund subscribers governed by the EPFO will get 8.75 per cent interest on their deposits for the current fiscal.
The Finance Ministry has been pitching for EPFO funds to be invested in the equity markets to maximise their yields.
The EPFO started investing in ETFs in August last year after the CBT in March cleared proposal to invest in equity markets.
The bill to amend payment of gratuity Act in order to double the ceiling of tax-free gratuity to Rs 20 lakh, would soon be placed before the Union Cabinet for approval.
The EPFO has about 5 crore (50 million) subscribers and the decision will have a bearing on their retirement fund.
The decision to suspend this benefit will hit 32 lakh pensioners.
EPFO manages a corpus of over Rs 8.5 lakh crore and its subscribers' base is over five crore at present.
The government has approved payment of 8.75 per cent rate of interest on PF deposits in 2013-14 for over five crore subscribers of retirement fund body EPFO.
Under the proposed scheme, there will be tripartite agreement with member, bank/housing agency and EPFO for pledging future PF contributions as EMI payment.
The move can help mop up about Rs 1.2 lakh every day for the purpose.
An advisory body of EPFO has rejected a proposal to engage private banks -- ICICI, Axis and HDFC Bank -- for collection of PF contribution from employers.
The EPFO pays rate of return to its subscribers on the basis of returns it generates from its investments.
The Employees' Provident Fund Organisation's apex decision making body, the Central Board of Trustees, had decided to provide 8.65 per cent rate of interest on EPF deposits last December.
The rest 25% would be paid to the subscriber at the age of 58.
'They (government) are trying to create market for pension products'.
The Finance Audit and Investment committee recommended 8.95% interest.
The UPA government's decision to ensure a minimum pension of Rs 1,000 a month under the retirement fund body EPFO's scheme, which will immediately benefit 28 lakh pensioners, is going to be a reality soon.
There will be tripartite pact with member, bank/housing agency and EPFO.
Retirement fund body EPFO will cut exposure in corporate bonds and park more funds in the secure government securities.
The EPFO is likely to decide soon the rate of interest on PF deposits for 2013-14, which is expected to be over 8.5 per cent.
EFPO launched a number of new facilities this year.
Retirement fund body EPFO's trustees on February 5 will decide on amending its scheme to provide a minimum monthly pension of Rs 1,000, which will immediately benefit its 27 lakh pensioners.
By region, Thiruvananthapuram leads with 247 defaulters, followed by Kolkata with 173 and Bhubaneswar with 115
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