Press Information Bureau
Government of India
Ministry of Labour &
Employment
19-December-2016 16:54 IST
Shri Bandaru Dattatreya chaired the 215th meeting of the Central Board of Trustees
(EPF)
CBT recommends 8.65% interest on EPF to its subscribers for the year 2016-
17
The
Minister of State for Labour and Employment (Independent Charge) Shri
Bandaru Dattatreya chaired the 215th meeting of the Central Board of
Trustees (EPF) in Bengaluru today.
Following are the key decisions of the Board.
1.
The Board adopted the 63rd Annual Report on the work and activities of
the EPFO for the year 2015-16 for placing it before the Parliament.
2.
Paragraph 60(1) of Employees’ Provident Funds Scheme 1952, requires
EPFO to credit to the account of each member interest at such rate as
determined by the Central Government in consultation with the Central
Board. The interest is credited to the members account on monthly
running balances basis with effect from the last day in each year.
Interest rates are dependent on return on investments done following the
pattern of investment prescribed by the Central Government from time to
time under Para 52 of the Scheme.
To recommend the rate of
interest for the year 2016-17, the status of estimated amount to the
credit of the members as on 01.04.2016, budget estimates (BE) of the
Contributions and Withdrawals during 2016-17 and the estimated income
from the investment holdings are taken into consideration. Interest
income from Provident Fund investments for the year 2016-17 has been
estimated mainly on the basis of interest income received/receivable in
the financial year 2016-17 including surplus from previous year of Rs
410 crore. It may be noted that the last year income included a surplus
from previous year of Rs 1604 crore.
Taking into account relevant
factors, the Central Board decided to recommend 8.65% interest to its
subscribers for the year 2016-17. Roughly 17 crore subscribers’ accounts
will be updated with this interest rate upon acceptance by the
Government.
3. Enrolment and Establishment coverage campaign 2017
This special campaign will be run in the following manner:
For
effective monitoring and implementation the Zonal Addl. CPFCs shall
lead the campaign. District Offices of EPFO will be activated and
sufficient number of officers will be exclusively engaged.
Meetings with
the stakeholders namely Employer & Employee associations and State
Governments will be held to make it a success. During the campaign wide
publicity of PMRPY and PMPRPY benefits will also be undertaken. Online
enrollment facilities to workers will form a key feature of the
campaign.
Window will be provided from 01.01.2017 till 31.03.2017.
Following recommendation will be made for approval of the Government.
i.
A nominal rate of levy of damages from the establishment for payment of
contribution for the past period during the campaign for enrolment will
be Rs one (Rs.1) per annum.
ii. Any employer during the campaign
period, may send declaration for membership of the employees who were
required or entitled to become members of the fund on or after the 1st
day of April, 2009 but before the 1st day of January, 2017 who could not
be enrolled for any reason.
iii. For the declaration made under
this campaign, the employer shall be responsible to remit the
contributions and interest payable in accordance with the provisions of
the Act and the Schemes read with special provisions notified by the
Central Government for enrolment campaign.
iv. No administrative
charges will be leviable for the past period in respect of the employees
enrolled during the campaign. The necessary amendments will be carried
out under the relevant provisions of EPF & EDLI Scheme
v. The
interest of workers enrolled under the campaign will be fully protected
and they shall be eligible to get all eligible interest and benefits as
laid down in the Schemes.
vi. To have uniform and nominal rate of
levy of damages from the establishment for payment of contribution for
the past period during the campaign for enrolment shall be fixed at Rs
one (Rs.1) per annum. Enabling provision shall be inserted under para
32(a) of the EPF Scheme 1952 and under para (5) of Employees Pension
Scheme, 1995 and para 8-A of EDLI Scheme, 1976.
This
campaign will be suitably staffed and resourced so that employers who
come forth to extend social security to their employees receive all
possible assistance from EPFO. The action will meet the twin objectives
of increasing the enrolment, extending social security benefits to all
workers and reducing litigation.
4. The Board approved a set of
guidelines for streamlining process of surrender of exemption granted to
establishments. Surrender of exemption is a situation where an
establishment requests to discontinue the exemption granted to it. As
the Act and Scheme is silent regarding the procedure of surrender of
exemption by an establishment, the decision assumes importance in
helping ease of doing business.
5. The Supreme Court in SLP
no.33032-33033 in the matter of R. C. Gupta & others has passed
certain orders of credit of amounts in the EPF accounts to the previous
accounts of employees in respect of wages more than the statutory wage
limit. The orders are to the effect that if amounts exceeding statutory
wage ceiling have been credited to EPFO, the classification thereon
shall be at the joint option of employers and employees. In accordance,
the Central Board approved a proposal for facilitating compliance. The
8.33% of the employer’s contribution proportionate to the salary of
employees in excess of Rs.6500/- shall now be credited to the pension
scheme along with the interest accrued in the provident fund account The
employees however shall be required submit joint application along with
their employer wherever the same has not been done. This will be
applicable only in those case where the members/pensioners have
contributed on higher wages than the statutory wage ceiling of Rs.6500/-
with or without exercise of option prior to the issue of notification
for increase of wage ceiling to Rs.15000/- effective from 01.09.2014.
6.
The administration cost of the Employees’ Provident Fund (EPF) and
Employees’ Deposit Linked Insurance Scheme (EDLI), 1976, is met from the
administrative and inspection charges collected from the employers of
un-exempted and exempted establishments. No charges however are levied
to run Employees’ Pension Scheme (EPS), 1995.
The Central
Government in consultation with the Central Board of Trustees, EPF fixes
the administrative charges from time to time. The administrative
charges were last reduced from 1.10% to 0.85% with effect from 1st
January, 2015.Considering the need to promote the “Ease of Doing
Business in India” and to make Indian business more competitive, and in
response to the financial efficiency gained by EPFO, the Central Board
decided to recommend further reduction of administrative charges to 0.65
%. It also recommended to abolish administrative charges levied in
implementing the EDLI Scheme, 1976 passing on the benefits of efficiency
and computerisation to employers. The Central Board also decided to
constitute a sub-committee of CBT with members drawn from employees and
employer representatives to make a pragmatic study of employment trends
for next 10 years and recommend appropriate administrative charges to
the Central Board.
7. The Chairman, CBT and the Minister of State
for Labour and Employment (Independent charge) announced that
Organisational Restructuring has been approved by the Union Government
for implementation. This includes Cadre Restructuring which will ensure
career progression of 20,000 staff/officers of EPFO. The Minister
announced that this will be implemented as a New Year gift.
