EPF Board recommends 8.5 per cent interest

The Central Board of Trustees of the Employees Provident Fund met here on Sunday and recommended 8.5 per cent interest to the subscribers for 2008-09, as against the demand for 9.5 per cent by trade unions.

The meeting also considered coverage of contract employees under the EPF Act and better extension of social security cover to the existing employees.

The matter would be discussed after obtaining views from various members, an official release said.

Objection

Representatives of major trade unions — the AITUC, CITU, BMS, HMS and AIUTUC — registered their protest at the meeting convened here under the chairmanship of Labour Minister Oscar Fernandes.

They were among those who said that the EPF interest rate be hiked to 9.5 per cent as promised by Prime Minister Manmohan Singh.

CITU Secretary Ardhendu Dakshi told The Hindu that barring 2005-06, when the interest rate stood at 9.5 per cent, it had always been low. He said that at a time when the government was announcing bail-out packages for various sectors, relief should have been given to workers for most of whom it is lifetime savings.

Mr. Dakshi said about 70 per cent of the fund’s Rs.33,000-crore corpus was with the government’s special depository schemes.

Contention rejected

The government’s contention that it would return interest out of the amount it earned was rejected by the unions.

For instance, even at the current 8.5 per cent, the government said there was a shortfall of Rs.140 crore.

Disappointing

CPI MP and labour leader Gurudas Dasgupta said the decision was “highly disappointing.”

He said the government should have declared a higher rate since the money it had was a perpetual loan.

The government should spend the funds to build social infrastructure.

Homage

The board paid respects to its former member Alampalli Venkataram, who passed away in January this year.

He was associated with the board for nearly 20 years as an employee’s representative.