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INDIA BUSINESS WORLD - November 16th December 31st 2008
PROVIDENT FUND INTEREST RATE TO REMAIN 8.5% THIS FISCAL YEAR
THE 4.4 crore subscribers of the Employees Provident Fund Organisation (EPFO) should not expect any rise in their provident fund interest rate this fiscal. Labour minister Oscar Fernandes ruled out the possibility of increasing the rate of interest of the Employees Provident Fund (EPF) rates for this fiscal year. This implies that the PF rate will continue to be 8.5 % fourth time in a row.
“There is no question of increasing the rate of interest," said the minister, who is also the chairman of the Central Board of Trustees (CBT), which is the core committee of EPFO.
Speaking to reporters on the sidelines of a conference organised by Ficci, Mr Fernandes pointed out that the interest rate of 8.5% was steady and the organisation will try to maintain it. EPFO only invests in government and public sector securities, and has escaped the wreck created by the stock market crash. The CBT, on various occasions, has said that it cannot risk employees’ money by investing in equity.
The interest rate for FY 2008-09 is yet to be announced by CBT. The issue did not figure at the last board meeting. Before that, the board was not in a position to take a decision as it was tied down by the model code of conduct in view of the assembly elections.
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