Over 28 lakh beneficiaries drawing pensions are set to benefit from the Finance Minister Arun Jaitley's budget announcement fixing the minimum pension under the Employee Provident Fund-95 scheme of the Employee Provident Fund Organisation (EPFO) scheme at Rs 1,000.
The Minister on Thursday revised the income ceiling under the EPF scheme from Rs. 6,500 to Rs. 15,000, which will increase the number of employees who will be eligible for PF contributions from employers.
Mr Jaitley said the EPFO will launch a scheme for portability of PF accounts.
Demands “For some time, employee unions have been demanding the government increase the pension amounts under EPF-95 scheme. The EPF at present has a deficit of thousands of crores and the Finance Ministry will be subsidising the EPFO for meeting this increase,” said a senior official at EPFO.
Besides the pensions drawn by individual beneficiaries, pension drawn by a spouse after a beneficiary's death has also been fixed at minimum Rs. 1,000, benefits drawn by children were increased from Rs. 150 per month to Rs. 250.
Portability Officials said that portability of PF accounts will be achieved by giving the beneficiaries a unique ID number.
“Each PF beneficiary will be given a unique ID number, this could be seeded with National Population Register or Aadhaar. This was started in 2000 but was not achieved fully because our offices were not fully computerised. But now, we have all our data in digital format,” said an official.
While the revised income ceiling from Rs 6,500 to Rs 15,000 will make it mandatory for establishments to contribute to PF for a larger number of employees, the EPFO officials admitted that enquiries revealed several instances in which establishments had evaded contributing PF amounts by showing lower wages, showing wages under the head of various allowances etc. This may continue even under the revised limits, said officials.
Under the Employees Provident Funds and Miscellaneous Provisions Act, 1952, the Act applies to all employees except those of the newspaper industry, foreign nationals, and those working in the cinema industry who get paid per project.
