New Delhi: Retirement fund body EPFO has decided to reduce the administrative charges to 0.50 percent of total wages of an employee, a move that is aimed to boost compliance and encourage more employers to avail of the scheme.
The Employees provident Fund Organisation’s (EPFO) decision making body, the Central Board of Trustee, had approved the proposal to reduce the administrative charges to 0.50 percent from the existing 0.65 percent of total wages, on which contributions are payable.
Labour Minister Santosh Gangwar told reporter after the Employees' Provident Fund Organisation's (EPFO) trustees meet on Wednesday that the trust has also decided to reduce the workers threshold for coverage under the EPFO schemes to 10 from existing 20.
At present, all those units employing 20 or more employees are mandatorily covered under the social security schemes run by the EPFO.
He expressed hopes that reduction in employees threshold could help increase the EPFO subscribers' base from existing 6 crore to even 9 crore.
EPFO has also lowered the rate of interest on employees provident fund to 8.55 percent for its over 6-crore subscribers for 2017-18, from 8.65 percent in the previous fiscal.
After the CBT's decision on interest rate, the proposal is vetted by the finance ministry. Once approved by the finance ministry, the rate of interest is credited into subscribers' account.
Gangwar further said the ETF investments have fetched a return of 20.65 per cent so far, and in the months of January and February this year, the EPFO has sold Rs 3,700 crore ETFs which earned a return of Rs 1,011 crore.
The EPFO has invested around Rs 44,000 crore so far in the ETFs. It had started investing in ETFs in August 2015.
With Agency Inputs