Under attack from Left parties for slashing EPF rate to 8.5 per cent, the government on Tuesday assured the Lok Sabha that it would not hesitate raising the interest rate if there was surplus fund by the end of the financial year.
"No final decision has been taken in this regard.. If there is surplus fund, then there will definitely be no hesitation on our part to raise the interest rate," Labour Minister Sis Ram Ola said.
The minister's remarks came at the end of a brief debate on a calling attention notice by CPI leader Gurudas Dasgupta during which the Left parties lashed out at the government for taking the 'unilateral' decision 'harming' the interest of lakhs of workers for whom this was the only social security.
Accusing the earlier NDA government of reducing the EPF rate from 12 per cent to 9 per cent, he said: "The legacy of the NDA government is being followed by the present government."
Seeking to put the ball in the finance ministry's court, Ola said: "Who am I to increase or decrease the interest rate. This is the job of the finance ministry which has pegged it at 8 per cent."
The labour minister said the interim 8.5 per cent interest rate would leave a deficit of Rs 206 crore. He said the Provident Fund Commissioner has been asked to take urgent steps to recover PF dues so that the deficit can be bridged.
Asserting that the government was determined to protect the interest of workers, Ola said he had written to the finance minister to consider raising the interest on Special Deposit Scheme.
He said the 9.5 EPF interest rate for 2002-03 was on an ad hoc basis which has still not been ratified by the finance ministry.
Similarly, the 9 per cent interest plus 0.5 per cent bonus for 2003-04 was also on an ad hoc basis. "This is not final, because till today the finance ministry has not ratified it."
Asked why this has not been done, he said: "Don't ask me this."
He said the finance committee of the Central Board of Trustee of the Employees' Provident Fund has been told to inform the labour ministry before the end of the financial year of any surplus funds.
"We will not hesitate in giving this to workers by way of interest," he said.
Dasgupta said decision on EPF rates had always been unanimous in the past and the government had gone ahead this time in unilaterally taking a decision despite most of the trade unions opposing any reduction.
He contended the decision to bring down the interest rate was not on the basis of scientific accounting. "There is no double-entry system and no income-expenditure account."