Provident fund issues ignored: Amit Gopal

The Budget turns out to be a damp squib for provident fund managers and, more importantly, employers. But the absence of significant announcements that make life easier will not be surprising.

The bad news was already in place; with the increase in provident fund rates being announced well before the Budget and uncertainty on the wherewithal to fund the liability.

Have the announcements of this Budget made any difference to provident funds? Sadly, no structural and administrative inefficiencies/ bottlenecks concerning employer liability, employee choice in asset allocation and EPFO being both administrator and regulator will ensure that provident funds do not benefit from the positives of this Budget.

So, is this a case of missed opportunities? Yes, it is. For, it is well recognised that if reforms are not undertaken urgently in provident funds, every stakeholder - employees, employers, the government "" stands to lose.

What was sorely missed was a policy statement that indicated the intent to integrate the regulatory frameworks for the government employees pensions and the provident fund. That would have set the agenda for reforming provident funds.