Union
Minister of Labour & Employment, Shri Mallikarjun Kharge Chaired the
190th Meeting of the Central Board of Trustees (EPF) in New Delhi
CBT decides to increase the rate of interest to be credited to EPF
members accounts for the year 2010-11 to 9.5 percent
The 190th meeting of the Central Board of Trustees, EPF, which was the eighth
regular meeting of the present Board, was convened in New Delhi today. Among the
22 agenda items placed before the Board, it considered a statutory item to
recommend rate of interest for the year 2010-2011 for crediting to the
subscribers account which was deferred by the Board in the last meeting. After
detailed deliberations the Board recommended 9.5% as the rate of interest for
the said year, from the surplus located in the interest suspense account.
The Board took two major policy decisions in the meeting. It approved closure of
inoperative accounts. It was decided that such accounts would be closed from
an appointed day and no interest would be credited to such accounts after 36
months of inoperation. This would entail closure of nearly 3 crore inoperative
accounts with various EPFO offices leading to more efficient accounting in
offices.
The Board recommended delinking of calculation of assurance benefit with the PF
balances payable to family of employees who die while in service under the EDLI
Scheme, 1976. It would be now calculated at 20 times the average monthly wages
drawn by the deceased employee in preceding 12 months of service. The maximum
benefit payable to the families of EPF subscribers on their death in service
would be Rs. 1.30 lakh. This would benefit the families of employees who die in
harness.
The Board also approved the process of appointment of new consultant for
initiating appointment of new fund managers to manage EPFO portfolio after
31.03.2011.
The Board discussed the directions of Ministry of Finance on revised investment
pattern to be followed by the CBT with regard to EPF corpus. The employees
representatives were concerned about the safety & security of the funds which
was primary consideration apart from the returns. Some of the employers
representatives supported investment of some corpus in capital market. It was
decided that the matter will be appropriately taken up with Ministry of Finance
on the issue of guarantee of safety of capital and a minimum return.
The Board also discussed the report of the Expert Committee on comprehensive
review of the Employees Pension Scheme 1995. The matter was deferred for further
deliberation in future.
The Union Minister of Labour & Employment, Shri Mallikarjun Kharge chaired the
190th Meeting of the Central Board of Trustees (Employees Provident Fund). Shri
Harish Rawat, Minister of State for Labour and Employment and Vice Chairman CBT,
EPF, was also present. CBT discussed all 21 items placed before the board and
decided to recommend the Rate of Interest to be credited o EPF members accounts
for the year 2010-11 at 9.5 percent. Talking to the Media persons after the
meeting Shri Mallikarjun Kharge said that the CBT want the PF money of the about
5 Crore workers to be safe and secure and invested in a manner to provide good
return on their accounts. The rate of interest on EPF has been pegged at 8.5 %
for the last five years from 2005-06 to 2009-10. Although the decision to
provide 9.5 per cent interest rate would result in a deficit of about Rs 1,600
crore, the same would be made good by a surplus of Rs 1,731 crore in the
interest account of the EPFO.
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