Meet on PF rate cut in April

Central Board of Trustees (CBT) of the Employees Provident Fund Organisation (EPFO) will meet in April to decide if the organisation can continue with the 9.5 per cent rate of return for its 32 million subscribers.

Labour ministry sources said a final view on the matter would emerge only after the EPFO, which will finalise its accounts by the end of this month, presents its books before the Board.

They said while the Fund was under tremendous pressure to cut its deposit rates due to the downward movement of interest rates, they had also sought the finance ministry's permission to diversify its investment avenues, including even picking up debt papers of private banks.

The CBT is the final authority when it comes to deciding the applicable interest rates for depositors to the Rs 1,40,000 crore Fund. In 2003, even though the interest rate was cut 0.5 per cent, a golden jubilee bonanza of 0.5 per cent virtually kept the 9.5 per cent rate intact.

The officials said the meeting of the CBT would not be affected by the dissolution of Parliament. However, with the finance ministry resolutely opposed to the continuation of the existing rates, a fresh fight between the labour and finance ministries is on the cards once a new government is sworn in.