New Delhi, July 5:Apart from clearing a much-deferred proposal to expand the Employees’ Provident Fund (EPF) net for firms employing at least ten employees from the current threshold of twenty employees, the Employees’ Provident Fund Organisation’s (EPFO) new Central Board of Trustees (CBT) chose to defer all other items on the agenda of its first meeting, including the PF rate for 2007-08. But it did provide a setting for opposition parties to up the ante against the government, already beleaguered by inflation and other assorted pre-poll headaches.

The EPF rate last year was 8.5 per cent and earnings allow the organisation to pay only 8.25 per cent for 2007-08. As expected, a few employee union representatives sought a higher PF rate in view of the high inflation at the meeting that took place in the Capital on Saturday. But instead of the Left parties’ union leaders who had asked for a 12 per cent PF rate in view of inflation crossing 11 per cent, it was the BJP-affiliated Bharatiya Majdoor Sangh member BM Rai who kicked off the interest rate debate by asking labour minister Oscar Fernandes to meet Prime Minister Manmohan Singh and work out a higher PF rate.

Government nominees on the Board as well as Fernandes interjected a few times to point out that the EPF Act of 1952 doesn’t allow paying out more than the fund earns. Rai, however, insisted that there was some ‘scope’ to pay a higher PF rate. Congress’ Indian National Trade Union Congress president G Sanjeeva Reddy and his colleague also piped in to neutralise Rai’s argument. Just as soon as representatives from Centre of Indian Trade Unions and All-India Trade Union Congress began to ask for a higher rate, Fernandes stepped in firmly and told members that the PF rate could be taken up at the next meeting.

After the meeting, Fernandes told reporters, “We have deferred the decision on PF rate for further consultations… The proposal on reducing the threshold limit for EPF coverage has been approved.”

FE

8.5 per cent

The Employee Provident Fund rate last year

8.25 per cent

The rate organisations are allowed to pay for 2007-08 according to their earnings

12 per cent

The EPF rate that union leaders of Left parties are demanding, citing inflation having crossed 11%

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