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EPFO Board meet today: Key announcements to watch out for

The minimum pension should be doubled from Rs 1,000 to Rs 6,000, according to central trade unions.

  • A significant topic during the meeting is expected to be an increase in the minimum pension.
  • The board of directors may decide to raise the minimum pension to Rs 3,000.
  • The minimum pension should be doubled from Rs 1,000 to Rs 6,000, according to central trade unions.

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EPFO Board meet today: Key announcements to watch out for

New Delhi: The Employees' Provident Fund Organisation's Central Board of Trustees will meet on November 20. The board will meet for the 229th time.

The board is a government-created statutory body established under Section 5A of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. It is made up of government officials, workers, and employers.

Investment 

An important agenda item will be expanding the EPFO's investment portfolio to include hitherto undiscovered investment opportunities. Alternative investment funds (AIFs) and infrastructure investment trusts (InvITs) are among the options that are expected to be studied.

Currently, the EPFO can invest 45-50% of its incremental deposits in government securities, 35-45% in debt instruments, 5-15% in equities, up to 5% in short-term debt instruments, and up to 5% in asset-backed, trust-structured, and other investments.

In April of this year, the labour ministry announced revisions to investment options, including the inclusion of units issued by Securities and Exchange Board of India-regulated Category I and Category II AIFs.

Hike in minimum pension

A significant topic during the meeting is expected to be an increase in the minimum pension. The board of directors may decide to raise the minimum pension to Rs 3,000.

The minimum pension should be doubled from Rs 1,000 to Rs 6,000, according to central trade unions.

The Parliamentary Standing Committee on Labour, chaired by Biju Janata Dal MP Bhartruhari Mahtab, suggested that the Employees' Pension Scheme's minimum pension be increased from Rs 1,000 to Rs 3,000. In its findings, the committee stated that the minimum pension, which was announced in 2014 and is still in effect, is insufficient.

Interest rate

The board of directors may talk about the interest rate for the current fiscal year (2021-2022).

The EPFO board suggested 8.5 percent interest for provident fund deposits for FY21 on March 4, which was approved by the finance minister on October 29. For FY20, the EPFO cut the interest rate on provident fund deposits to an all-time low of 8.5 percent.

In FY19, the interest rate was 8.65%, 8.55 percent in FY18, and 8.65 percent in FY17.

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