EPFO asked to get Ministry of Finance approval before announcing interest rate

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Published September 17, 2023 at 9:35am

    This is an alteration to the standard practice

    Ministry of Finance communicated the change to EPFO in July 2023

    Finance Ministry wants interest rate to be in line with market interest rate

The Ministry of Finance has directed the Employees’ Provident Fund Organisation (EPFO) to seek permission from the Ministry of Finance and the Ministry of Labour and Employment before publicly announcing the interest rate from the next year onwards as per a response to a Right To Information (RTI) petition filed by The Indian Express. This is an alteration to the standard practice the organisation has followed over the years.   

“Para 60 (1) of EPF Scheme requires the interest rate on accumulated corpus to be determined by the Central Government in consultation with the CBT, EPFO. Given the fact that there has been an overdrawal in the Interest Suspense Account in FY 2021-22 against a surplus projected to Ministry of Finance while the interest rate for FY 2021-22 was been fixed, EPFO is advised that in future, interest rate recommendations of CBT may be made public only after the same has been accepted by M/O Finance,” an official memorandum, dated July 13th by the Ministry of Finance stated, while approving the 8.15% interest rate for the year 2022-23. 

 

 “EPFO is advised that in future, interest rate recommendations of CBT may be made public only after the same has been accepted by M/O Finance. EPFO is therefore requested to follow guidance as directed by the Ministry of Finance, which has approval of the Hon’ble Finance Minister. This issues with approval of HLEM (Hon’ble Labour and Employment Minister),” a letter to the EPFO by the  Ministry of Labour and Employmenton July 18th stated. 

EPFO asked to get Ministry of Finance approval before announcing interest rate

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    This is an alteration to the standard practice

    Ministry of Finance communicated the change to EPFO in July 2023

    Finance Ministry wants interest rate to be in line with market interest rate

The Ministry of Finance has directed the Employees’ Provident Fund Organisation (EPFO) to seek permission from the Ministry of Finance and the Ministry of Labour and Employment before publicly announcing the interest rate from the next year onwards as per a response to a Right To Information (RTI) petition filed by The Indian Express. This is an alteration to the standard practice the organisation has followed over the years.   

“Para 60 (1) of EPF Scheme requires the interest rate on accumulated corpus to be determined by the Central Government in consultation with the CBT, EPFO. Given the fact that there has been an overdrawal in the Interest Suspense Account in FY 2021-22 against a surplus projected to Ministry of Finance while the interest rate for FY 2021-22 was been fixed, EPFO is advised that in future, interest rate recommendations of CBT may be made public only after the same has been accepted by M/O Finance,” an official memorandum, dated July 13th by the Ministry of Finance stated, while approving the 8.15% interest rate for the year 2022-23. 

 

 “EPFO is advised that in future, interest rate recommendations of CBT may be made public only after the same has been accepted by M/O Finance. EPFO is therefore requested to follow guidance as directed by the Ministry of Finance, which has approval of the Hon’ble Finance Minister. This issues with approval of HLEM (Hon’ble Labour and Employment Minister),” a letter to the EPFO by the  Ministry of Labour and Employmenton July 18th stated. 

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