The Finance Ministry, which had raised some queries on the Employees Provident Fund Organisation’s (EPFO) ability to pay 9.5 per cent interest to about 5 crore PF subcribers for their PF savings for 2010-11, on Thursday finally approved the rate.
The total outgo due to the new interest rate to the EPFO will be around Rs.16,000 crore for 2010-11.
Labour Secretary P.C. Chathurvedi told “The Hindu” that the notification in this regard from the finance ministry was received by his ministry. This was the first time the interest rate had been hiked by one per cent to 9.5 from 8.5 that had been given since 2005-06 to the PF subscribers, he said.
Central Provident Fund Commissioner Samirendra Chatterjee said the Central Board of Trustees raised the interest rate in September last year after working out that about Rs.1731 crore was lying in the interest suspense in EPFO account books.
The calculations of EPFO had been vindicated with the approval of the finance ministry for the new rate, he said adding that EPFO had been asked by the finance ministry to update the subscribers accounts within six months.