EPFO may provide housing to subscribers

Besides managing retirement funds, EPFO may come out with a scheme to provide housing to its over 5 crore (50 million) subscribers on additional contribution of 10 per cent by them from their basic wages every month.

The idea was mooted by Labour Minister Oscar Fernandes during a function of Employees' Provident Fund Organisation (EPFO) on Sunday.

"EPFO can deduct extra 10 per cent of their basic wages over the mandatory contribution of 12 per cent made by them at present. The money can be used to provide them housing facility," he said.

The minister said most of the workers throughout their working life live in rented accommodation and their entire saving on retirement is spent on purchasing a house.

At present, all workers covered under the EPFO schemes, pay 12 per cent of their basic wages toward PF contribution every month. The basic wages include basic pay and dearness allowance.

Asked about the minister's proposal, EPFO's central Provident Fund Commissioner K K Jalan said: "We will definitely work on the proposal. He (the minister) has a lot experience."

As per another official, EPFO had earlier constructed houses and provided to workers covered under its scheme. However, they did not have to make any additional contribution during the Sahib Singh Verma's tenure as Labour Minister.

EPFO has a corpus of around Rs 5 lakh crore and receives an incremental deposits of over Rs 60,000 crore (Rs 600 billion) every year.

An EPFO subscriber said: "The body has the huge financial strength to take up any big housing project and complete it. But one has to see that how many members would come forward to take a cut of 10 per cent cut on their basic wages."