The board of the Employees’ Provident Fund Organisation (EPFO) is holding a two-day meeting 27th and 28th March 2023 to discuss a range of issues that would affect around 6 crore active EPFO subscribers. The Central Board of Trustees (CBT) meeting was scheduled to take place on March 25-26 but was postponed for two days due to administrative reasons. The meeting will be chaired by Union labour and employment minister Bhupender Yadav, and its decisions would have far-reaching effects on EPFO subscribers.

Some of the issues that are likely to be discussed during the CBT meeting include the FY23 interest rates, annual financial estimates, higher salary-linked pension, ceiling wage, minimum pension, and tweaks to benefits. The meeting is also expected to touch on investment issues and whether the EPFO should allow increased investment of incremental deposits in equity instruments.

EPFO Board Meeting: Key decisions on higher pension, interest rates and more

One of the key issues to be discussed during the CBT meeting is the interest rate for FY23. It is recommended that the EPF interest rate for FY23 should be around 8 percent. The CBT had previously recommended 8.1 percent for FY22 in March 2022, which was later ratified by the finance ministry in June of that year. This left the EPFO with an estimated Rs 450 crore surplus, which means rates are likely to remain within the same range. In 2022, many subscribers experienced a delay in interest credit, and it was also the first year that the Union Budget proposed taxing interest on higher contributions to EPF. The 8.1 percent rate offered was the lowest by EPFO since the 1980s.

Another issue that will be discussed during the CBT meeting is the higher pension option for subscribers after the Supreme Court order. The EPFO allowed employees to opt for a higher pension linked to salaries until May 3. The option was seen as a resolution of two issues, a progressive increase in the number of pensioners, and the gap between the net present value (NPV) of contributions and benefits. The CBT is expected to have detailed talks regarding the higher pension option for subscribers and how it can be implemented effectively.

The ceiling wage is another issue that was likely to be discussed during the CBT meeting. The ceiling wage is expected to be raised from Rs 15,000 a month to Rs 21,000. This would be the latest revision after this ceiling was last raised from Rs 6,000 a month to Rs 15,000 in 2014 for companies with more than 20 employees. The CBT may also look at increasing the minimum pension to Rs 3,000 a month from Rs 1,000. This will be in line with recommendations by the parliamentary standing committee on labour. Trade Unions are demanding an increase to Rs 6,000 a month. The Rs 1,000-a-month floor was introduced in 2014.


The CBT meeting is also expected to discuss tweaks to benefits. The EPFO could discuss steps to bolster its coverage for workers and its corpus levels. The extension of the pension scheme beyond 35 years of service and withdrawal benefits for those who have contributed for less than six months may also be considered.

Investment is another topic to be discussed during the CBT meeting. The EPFO may consider allowing increased investment of incremental deposits in equity instruments regardless of the age or risk profile of members. Instruments under consideration include infrastructure investment trusts (InvITs) and alternative investment funds (AIFs). This would be a bold move as, at present, the organization invests 45-50 percent in government securities, 35-45 percent in debt, 5-15 percent in short-term debt, and 5 percent in asset-backed or other instruments.

In conclusion, the decisions that will be taken by the board during the CBT meeting would have far-reaching implications for the six crore active subscribers of the Employees’ Provident Fund Organisation (EPFO). The issues likely to be discussed include the interest rate for FY23, the higher salary-linked pension, raising the ceiling wage, increasing the minimum pension, and potential tweaks to benefits. Additionally, discussions may take place on allowing increased investment in equity instruments and extending the pension scheme beyond 35 years of service. These decisions will have a significant impact on the lives of millions of EPFO subscribers, and it remains to be seen what the outcome of the CBT meeting will be.


The author is a Chartered Accountant with 2 decades of experience into Accounting, Taxation, Auditing, Risk & Compliance, Credit Controls, Due diligence. Currently, the author is the founder and managing partner at RRL Global services.  

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