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EPFO may put off decision on rate

BS Economy Bureau in New Delhi | July 13, 2004 09:25 IST

The Central Board of Trustees of the Employees Provident Fund Organisation is likely to defer a decision on setting a rate of interest on its deposits, when it meets on Tuesday.

A crucial meeting of the trade unions, on the eve of the Board meeting, stuck to their stand that the government must reverse its decision to maintain the rate of interest on the special deposit schemes at 8 per cent, in which, the EPFO parks 80 per cent of its investment.

Talking to reporters after the meeting, W R Varadarajan, secretary, Citu and member of the CBT, said they had asked for a meeting with Prime Minister Manmohan Singh, to resolve the issue.

Since the meeting with the Prime Minister was not expected to happen before next week, some of the union leaders said a stalemate was inevitable.

They also said they did not expect Finance Minister P Chidambaram to roll back a decision on the special deposit schemes, even before the Lok Sabha had begun its Budget discussions.

However, differences among the trade unions on the issue cropped up, as the Intuc refused to sign a joint statement by the unions, asking the government to "seriously reconsider its approach" on maintaining the present rates of administered interest rates, asked for scrapping the decision to hike foreign direct investment in telecom, civil aviation and insurance and withdrawal of perquisite taxation.

The unions said the government should provide a subsidy to ensure that the EPFO could at least stick to the 9.5 per cent rate of interest paid in 2002-03 and 2003-04.

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