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Panel to decide rate of interest on PF

By Our Staff Correspondent

NEW DELHI APRIL 30. The rate of interest to be paid to the employees on their Provident Fund between April 1, 2003 to March 31, 2004 will be decided by the recently constituted Finance and Investment Committee, appointed to decide upon the interest rates on the EPF. This decision was taken at a meeting of the Central Board of Trustees held here.

The Finance and Investment Committee, that was supposed to give its recommendations by the end of April, has, however, not submitted its report so far. Sources in the Labour Ministry said that the recommendations will come in another 10 days, by when Parliament session would have ended and the Ministry would not have to face a strong reaction in case the F&I Committee suggests lowering of interest rates, as it is likely to do, since the interest rates on small savings have been lowered across the board.

The Labour Minister, on his part, has been maintaining that he is opposed to reducing the rate of interest on the Employees Provident Fund.

Sources said that the interest credited to the employees' funds would be based on the current rate until a final decision is taken.

Meanwhile, the Centre of Indian Trade Unions has denounced the "anti-worker'' decision taken by the Employees Provident Fund Organisation to stop release of any interest payment to members account for the month of April 2003 till the final notification for declaration of rate of interest for 2003-04 on PF deposits is issued.

In a statement issued here, the CITU has claimed that the EPF Organisation has recently sent a circular to the Regional PF offices, advising them to settle the PF claims of the outgoing members owing to superannuation, death or otherwise, in part, without crediting any interest for the period from April 2003 onwards.

Such action of EPFO is unprecedented, the CITU said, adding that even last year there was divergence of views between the CBT and Ministry of Finance over continuous of the 9.5 per cent interest rate, the EPFO continued to credit interest-payment to members account at the existing rate.

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