The meeting of CBT of the Employees Provident Fund Organisation, whose chairman is Labour Minister K Chandrasekhar Rao, was earlier scheduled for July 30 but put off due to "technical reasons".
The finance and investment sub-committee of the EPFO had in September recommended 8 per cent rate for this fiscal. EPF subscribers got 9.5 per cent EPF rate last fiscal, which had resulted in the loss of Rs 716 crore (Rs 7.16 billion).
The deficit was met through the reserve fund, which now has a corpus of Rs 250 crore (Rs 2.5 billion), sources said.
The rate should have been close to 8.5 per cent for not resulting in any deficit as the fund had a corpus of Rs 72,000 crore (Rs 720 billion) as on March 31, 2004.
As on March 31, 2005 the corpus has increased to Rs 79,000 crore (Rs 790 billion). About 4 crore (40 million) people subscribed to EPF last year and number had risen to 4.11 crore (41.1 million) now. Both RSS-affiliated BMS and CPI-M's trade union CITU said they will demand at least 9.5 per cent EPF rate.
In fact, former BMS President and its representative in the CBT Hasubhai Dave said his organisation will call for a 12 per cent rate, much above the last year's. Dave said a BMS representative had stated in the sub-committee that 12 per cent rate could be easily given.
CITU member in CBT W R Varadarajan said his organisation would demand that at least 9.5 per cent EPF rate be given as per 'Prime Minister Manmohan Singh's assurance'.
According to the CITU leader, the Prime Minister has assured that the UPA government would not reduce the EPF rate from 9.5 per cent and "we take the assurance for the entire term of the UPA government."
He demanded that the government increase the administered rate of interest on special deposit schemes, where most of the employment provident fund is parked, from the current 8 per cent rate instead of taking help of reserve funds.
Hind Mazdoor Sabha Secretary A D Nagpal said a certain minimum rate should be fixed for EPF. The rate could be arrived at after discussion among CBT. Under no circumstances, EPF rate should fall below such level, he said.
However, Congress President G Sanjeeva Reddy said the EPF rate should be equal to what is earned from the fund.
Many members had insisted that 9.5 per cent rate be given last fiscal and the deficit be met through government subsidies but no subsidy was given and reserve fund was used.
"We are against using reserve fund," he said. Of the total 41 members of CBT, 10 each represent trade unions and employers, 15 are representative of state governments and 5 are from the Union Government, while the remaining one is the Labour Minister as the chairman.
The meeting is also likely to discuss investment pattern of the EPF corpus.
