The Finance Ministry has approved the 8.65 per cent interest proposed earlier this month on employee provident fund (EPF) for the 2016-17 fiscal, Labour Minister Bandaru Dattatreya confirmed on Thursday. The move is expected to benefit an estimated four crore registered members of the EPF.
The official confirmation will now make it possible for the Employee Provident Fund Organisation (EPFO) to credit the interest into accounts of registered members. “Finance Ministry has agreed to 8.65 per cent rate of interest. Now, the communication will come. The formal discussions are over,” Dattatreya said, adding, “We will immediately issue the notification and credit the rate of interest to over four crore subscribers.”
“The Central Board of Trustees (CBT) had decided to give 8.65 per cent. Our ministry keeps on discussing with the Finance Ministry. We would have surplus of Rs 158 crore on providing 8.65 per cent,” Dattatreya was reported as saying earlier this month.
The Finance Ministry had, in the 2015-16 fiscal as well, tried to bring down the then EPF rate of 8.8 per cent to 8.7 per cent, as approved by the Central Board of Trustees (CBT). However, it had not fallen through with any of the concerned stakeholders, following which the decision was scrapped.
The initial approval for the 8.65 per cent EPF rate was consented to by the EPFO in December 2016. The Labour Ministry was being pushed by the Finance Ministry, although with some reluctance, to bring the EPF rate down so as to bring it at par with other schemes such as the PPF.
- With PTI inputs.