21/01/2017
Once again, the central government has slashed the interest rate of Provident Fund of crores of employees and workers of the country for the year 2016-2017. The interest rate of accrued amount of P.F. is decided by the Central Board of Trustees of Employees Provident Fund Organization, EPFO. In its 215th meeting, at Bengaluru, on 19th December this year, our union labour minister, Mr. BandaruDattatreya, the chairperson of EPFO, proposed to reduce the rate of interest of accrued amount of PF from 8.8% to 8.6% for 2016-2017. Facing strong protest by all trade union representatives, except that of BMS, the labour minister unilaterally announced the decision of 8.65% interest
rate, in spite of vehement protest by the trade unions. This reduction of 0.15% interest on the accrued amount of PF of 19 crores of members will create a surplus fund of Rs.295.91 crores.
The hidden reason was unearthed later. Following vigorous pressure exerted by CITU and some other trade unions, it was unveiled by the PF authority that, during 2015-2016 financial year, Rs.6168.15 crores from PF fund was invested in share market as per the policy of the government. In lieu of profit, there was a loss of Rs. 565 crores (9.54%) during this year from share market. As on 31st October, 2016, the value of the invested amount (Rs.6168.15 crores) became Rs.5920 crores. To meet this huge loss incurred from the share market, the government directed the EPFO to cut the pocket of the crores of workers and employees.
Despite, being an independent authority, EPFO acts as per the fancies of the central government. The poor people of the country are repeatedly falling prey to the wrong policies of the government. To cover up the huge loss incurred, the earnings of crores of superannuated are axed by the way of reduction of interest rates adversely affecting their
livelihood.
Ignoring the strong objection from the trade union representatives, EPFO also has decided to increase the quantum of its investment from 5% to 10% in the share market in 2017. The amount to be invested from PF fund in 2017 in share market will be Rs.13000 crores, double the amount invested in 2016. The government did not take any lesson from the past. Rather, they are squandering away the people’s interest and playing ducks and drakes with the livelihood of crores of poor people, who are only and fully depended on their accumulated PF, after superannuation.
In addition to this, EPFO has also decided to soften the statutory actions against the erring employers. The employers, not complying with the statutory provisions of registering their companies with EPFO, will be exempted
from stringent punitive action and will be allowed to register their companies during 1st quarter of 2017 , paying a
penalty of Rs.1/- per year and they are exempted from all pending administrative charges. Moreover, the current
administrative charges for the employers have also been slashed from 0.85% to 0.65%.
Earlier, this government had announced deduction of income tax during withdrawal of the deposited amount from
PF. The united movement of the workers of the country forced the government to roll back their decision.
In one side the government is taxing the workers in all possible areas and in other side giving full relaxation to the employers by the way of amending the laws, waiving of their huge unpaid loans and exempting them from paying the statutory penalty for non-compliance of the law of the land . FMRAI has already reacted on this issue. Through a protest letter addressed to the union labour minister, FMRAI has registered strong protest against the decision of
reduction of PF interest and demanded its roll back. FMRAI has also called upon the members to participate in the united movement of the workers with full strength to defeat the sinister motive of the central government and to
protect the interest of the workers of the country.
