A decision on the interest rate for provident fund deposits for 2022-23 is likely to be taken on Tuesday, on the second day of the meeting of the Central Board of Trustees of the Employees’ Provident Fund Organisation. According to sources, the issue was not put up to the CBT in its meeting on Monday.
With the end of the current financial year, over 67.8 million contributing members of the Employees’ Provident Fund are keen on knowing the interest rate. The EPFO had lowered the interest rate on the scheme to 8.1% for 2021-22, which was the lowest since 1977-78. Indications are that the rate of interest for the current fiscal also may not see a significant upward revision and could remain at around 8%.
The CBT, which is the apex decision making body of the EPFO and is chaired by Union labour and employment minister Bhupender Yadav, is understood to have taken up the issue of higher pension under the Employees’ Pension Scheme following the November 2022 ruling of the Supreme Court. This was the first meeting of the CBT since the judgement of the apex court on the EPS.
“The issue was discussed at length and every member of the board was very passionate about it, pointing out that they had no clear answers to give to members of the EPS on how to opt for higher pension,” said another source. The CBT members also noted that the EPFO does not seem to have allocated additional Budget for any higher outgo on the EPS.
The EPFO is likely to start an actuarial analysis and ascertain the financial implications on the scheme’s corpus and liabilities once fresh applications for higher pension have been verified. Subscribers can apply till May 3 for higher pension.
The CBT meeting is also understood to have discussed the annual accounts of the EPFO for 2022-23. Contributions to the EPFO are estimated to rise to Rs 2.08 trillion in FY24, which is about 7% higher than Rs 1.94 trillion in the current fiscal. The net income of the EPF is seen at Rs 7,945 crore next fiscal, marginally higher than Rs 7,393 crore in the current fiscal.