The Central Boad of Trustees of Employees Provident Fund on Wednesday deferred to July 13 a decision on interest to be paid for its 3 crore (30 million) subscribers this year awaiting outcome of the Budget on the status of Special Deposit Schemes, which constitute 80 per cent of its investments.
"A decision on the EPF rates has been deferred to July 13. All members wanted SDS to continue and accordingly we have unanimously approved the proposal and recommended the same to the finance ministry," Labour Minister Sis Ram Ola told media after a marathon over five-hours CBT meeting in New Delhi.
Ola said he decided to go by the views of the CBT members to defer a decision since the Union Budget would give a clear picture.
The SDS, which offers 8 per cent returns, does not allow any re-investment of EPF as the previous NDA government had scrapped this provision. Also there is a proposal to phase out the SDS.
Ola, however, has written to the finance minister urging him to continue with SDS but a clear picture on the issue would emerge only after the Budget.
He said there have been demands from some trade unions to raise the interest to 12 per cent, while others maintained that the present 9.5 per cent should be continued.
However, CBT's Finance and Investment sub-committee had recommended 8 per cent since only at that level, the CBT could earn surplus of Rs 153.89 crore (Rs 1.54 billion) for this year.