NEW DELHI: Retirement Fund Agency EPFO on Wednesday it decided to provide an interest rate of 8.5 percent on the Employee Provident Fund (EPF) for 2019-20 as previously committed.
In March this year, the highest decision-making body of the Employees Provident Fund Organization (EPFO), the Central Council of Trustees, headed by Labor Minister Santosh Gangwar, approved an interest rate of 8, 5 percent on the EPF for the last fiscal year.
At a CBT virtual meeting on Wednesday, the EPFO decided to provide an 8.5 percent interest rate, according to a statement from the Labor Ministry.
“Faced with exceptional circumstances derived from COVID-19, the Central Board reviewed the agenda on the interest rate and recommended the same rate of 8.50 percent to the Central Government.
“This (8.5 percent interest) would comprise 8.15 percent of debt proceeds and the balance of 0.35 percent (capital gain) from the sale of ETFs (exchange-traded funds) subject to to its redemption before December 31, 2020, “the statement said. .
The board has recommended accounting for such capital gains (from ETF sales) in the 2019-20 financial year results as an exceptional case.
According to one source, the EPFO will soon provide 8.15 percent interest on the EPF and the remaining 0.35 percent rate will be credited to subscribers’ account by December 31, after the proposed settlement. of ETFs.
EPFO had previously planned to liquidate part of its investment in ETFs to provide 8.5 percent interest for the last fiscal year.
However, it was unable to do so due to choppy market conditions amid the COVID-19-induced lockdown.
Now, after reassessing the situation, the CBT found that the EPFO can provide an interest rate of 8.5 percent on the EPF for 2019-20.
In addition, the CBT also decided to increase the maximum insured amount payable under the 1976 Employee Deposit Linked Insurance Scheme to 7 lakhs of rupees from the existing 6 lakhs of rupees.
“The Central Board approved the amendment to paragraph 22 (3) of the Employee Deposit Linked Insurance Plan (EDLI), 1976 to improve the maximum guarantee benefit to 7 lakhs rupees from the current maximum guarantee benefit of 6 lakhs rupees, “the statement read said.
This amendment will provide additional assistance to the families and dependents of plan members in the event of their unfortunate death while on duty.
The CBT was also informed that the actuarial valuation of the EDLI Fund has allowed the continuation of the minimum guarantee benefit of Rs 2.5 lakh beyond February 14, 2020, and the extension of the minimum guarantee benefit of Rs 2.5 lakh to the family of deceased members who were employed. at multiple facilities during the 12 months prior to the month they died, as approved by the council at its 226th meeting.
During the meeting, Gangwar also launched the virtual hearing facility in quasi-judicial cases under the EPF & MP Act of 1952 via video conference.
The objective of integrating the virtual hearing utilities with the EPFO electronic Tribunal process in the Electronic Compliance Procedures Portal is to eliminate the physical presence of the parties in the hearings before the Adjudicator.
The system implies savings in time, travel and expenses for the parties, ensures compliance with the rules of social distancing during the pandemic, and streamlines the evaluation of workers’ EPF quotas to generate greater confidence in the quasi-judicial mechanism.
It is a critical advance toward the goal of faceless quasi-judicial proceedings at the EPFO.
On video: EPFO decides to credit part of the 8.5% interest for fiscal year 2020: Report
In March this year, the highest decision-making body of the Employees Provident Fund Organization (EPFO), the Central Council of Trustees, headed by Labor Minister Santosh Gangwar, approved an interest rate of 8, 5 percent on the EPF for the last fiscal year.
At a CBT virtual meeting on Wednesday, the EPFO decided to provide an 8.5 percent interest rate, according to a statement from the Labor Ministry.
“Faced with exceptional circumstances derived from COVID-19, the Central Board reviewed the agenda on the interest rate and recommended the same rate of 8.50 percent to the Central Government.
“This (8.5 percent interest) would comprise 8.15 percent of debt proceeds and the balance of 0.35 percent (capital gain) from the sale of ETFs (exchange-traded funds) subject to to its redemption before December 31, 2020, “the statement said. .
The board has recommended accounting for such capital gains (from ETF sales) in the 2019-20 financial year results as an exceptional case.
According to one source, the EPFO will soon provide 8.15 percent interest on the EPF and the remaining 0.35 percent rate will be credited to subscribers’ account by December 31, after the proposed settlement. of ETFs.
EPFO had previously planned to liquidate part of its investment in ETFs to provide 8.5 percent interest for the last fiscal year.
However, it was unable to do so due to choppy market conditions amid the COVID-19-induced lockdown.
Now, after reassessing the situation, the CBT found that the EPFO can provide an interest rate of 8.5 percent on the EPF for 2019-20.
In addition, the CBT also decided to increase the maximum insured amount payable under the 1976 Employee Deposit Linked Insurance Scheme to 7 lakhs of rupees from the existing 6 lakhs of rupees.
“The Central Board approved the amendment to paragraph 22 (3) of the Employee Deposit Linked Insurance Plan (EDLI), 1976 to improve the maximum guarantee benefit to 7 lakhs rupees from the current maximum guarantee benefit of 6 lakhs rupees, “the statement read said.
This amendment will provide additional assistance to the families and dependents of plan members in the event of their unfortunate death while on duty.
The CBT was also informed that the actuarial valuation of the EDLI Fund has allowed the continuation of the minimum guarantee benefit of Rs 2.5 lakh beyond February 14, 2020, and the extension of the minimum guarantee benefit of Rs 2.5 lakh to the family of deceased members who were employed. at multiple facilities during the 12 months prior to the month they died, as approved by the council at its 226th meeting.
During the meeting, Gangwar also launched the virtual hearing facility in quasi-judicial cases under the EPF & MP Act of 1952 via video conference.
The objective of integrating the virtual hearing utilities with the EPFO electronic Tribunal process in the Electronic Compliance Procedures Portal is to eliminate the physical presence of the parties in the hearings before the Adjudicator.
The system implies savings in time, travel and expenses for the parties, ensures compliance with the rules of social distancing during the pandemic, and streamlines the evaluation of workers’ EPF quotas to generate greater confidence in the quasi-judicial mechanism.
It is a critical advance toward the goal of faceless quasi-judicial proceedings at the EPFO.
On video: EPFO decides to credit part of the 8.5% interest for fiscal year 2020: Report
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