The EPFO Buzz This Week

Retirement fund body, EPFO has decided to put on hold the decision to make it mandatory for new members joining EPF scheme to provide Aadhaar number as credential for enrolment from March 1, 2013.

"In view of discussion with UIDAI official and the time required in the process of obtaining Aadhaar numbers, it may not be possible to obtain Aadhaar number by EPF members by March 1, 2013. Therefore it has been decided to not to make Aadhar number mandatory for EPFO members March 1, 2013", an EPFO order to the field staff said.

Late last month, Employees' Provident Fund Organisation's (EPFO) decision drew flak from trade unions, following which the body has now decided to put it on hold.

However, the field staff has been asked to make efforts to obtain the available Aadhaar number of EPF members.

The staff has also been asked to collect core banking account numbers of all contributing members. The EPFO order has observed that getting the Aadhaar is a time consuming process and the scheme covers 18 states only. The remaining states are covered by the Register General of India under the National Population Register which would be digital database of country's residents.

EPFO had envisaged replacing members' account numbers with their Aadhaar numbers to avoid inconvenience to people as they had to apply for transfer of PF money to new accounts while changing jobs.

Now, EPFO is working on creating a central data base where all members would have a permanent account number and would not require to transfer PF accounts on changing job.

Besides, this will help EPFO members, particularly construction workers, who often change their jobs or contractors.

The next news that buzzed from EPFO premises this week was that it may get 8.5 per cent return on their investment during 2012-13, higher than 8.25 per cent provided in the last fiscal.

The body's proposal is likely to come up for discussion during its apex decision making body Central Board of Trustees (CBT) scheduled on February 15, a source said.

"The EPFO has worked out 8.5 per cent rate of return for the current fiscal. It will not leave any deficit. However, the proposal has not been finalised as yet," the source added.

The Employees Provident Fund Organisation (EPFO) had paid 9.5 per cent interest in 2010-11, before scaling it down to 8.25 per cent in 2011-12 fiscal.

EPFO will place the proposal regarding the interest rate before its advisory body Finance and Investment Committee (FIC) at its meeting on February 14. Once approved by the FIC, it will go to Labour Minister-headed CBT for final approval.

The notification on interest rate is issued by the government after concurrence by the Finance Ministry.

Although EPFO announces interest rate at the beginning of the year, there has been a delay this time. Trade unions have been pressing for an early meeting of the CBT to decide on the interest rate for the current fiscal.