1. Finance ministry to go ahead with 8.7 per cent interest rate for EPF

Finance ministry to go ahead with 8.7 per cent interest rate for EPF

The finance ministry will notify the interest rate of 8.7% for employees’ provident fund (EPF) subscribers for the 2015-16 fiscal despite concerns raised by the labour ministry.

By: | New Delhi | Published: April 29, 2016 5:49 AM

The finance ministry will notify the interest rate of 8.7% for employees’ provident fund (EPF) subscribers for the 2015-16 fiscal despite concerns raised by the labour ministry.

As reported earlier, North Block had, notwithstanding the EPFO’s Central Board of Trustee’s (CBT) recommendation of 8.8% return for EPF subscribers, decided to offer them only 8.7%.

“The finance ministry’s decision is likely to prevail for two reasons. First, the labour ministry does not want any confrontation with it as that will send a wrong message and secondly, the declining trend of interest rates which the EPFO has to fall in line with,” a senior labour ministry official said.

In addition, after providing 8.8% return to its five crore active subscribers, the EPFO would not have much surplus left to maintain a relatively uniform rate in coming years, which is not desirable, the official said.

The EPFO had doled out 8.75% rate of interest to its subscribers for their savings in PF in the previous
two fiscals.

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