EPFO trustees may discuss Budget proposals tomorrow

EPFO trustees are likely to discuss Budget proposals tomorrow, including making PF contribution optional for workers receiving salary below a threshold and allowing subscribers to choose between social schemes run by the retirement fund body and others.
Employees' Provident Fund Organisation's (EPFO) apex decision making body, Central Board of Trustees, headed by the Labour Minister, is also likely to appoint new fund managers for three year term, beginning April 1, and raise age limit for vesting of pension by two years to 60.
"Though the discussion of Budget proposal is not listed on the agenda of the CBT meeting tomorrow, but it is likely to come as any issue can be discussed with the permission of the Chair," a source said.

As part of his Budget speech, Finance Minister Arun Jaitley had announced that options like exemption from PF contributions for certain workers and allowing all members to choose between EPFO schemes and other schemes will be provided.
"... For employees below a certain threshold of monthly income, contribution to EPF should be optional, without affecting or reducing the employer's contribution," Finance Minister Arun Jaitley had said in the Budget speech.
The Budget proposals, however, did not specify the salary threshold for this.

At present, all employees are required to pay 12 per cent of basic wages, including basic salary and DA, as contribution to the PF.

The employers make a matching contribution, with 8.33 per cent going towards pension, 0.5 per cent towards Employees Deposit Linked Insurance (EDLI) scheme and remaining towards provident fund.
Jaitley had also said employees will get to choose between EPF scheme run by retirement fund body EPFO and the New Pension Scheme (NPS) as also between health insurance products and Employees State Insurance Corporation's (ESIC) health cover.
"With respect to the EPF, the employee needs to be provided two options. Firstly, the employee may opt for EPF or the New Pension Scheme (NPS)," Jaitley said.
He further said that employees should have an option of choosing either ESI (health cover) or a health insurance, recognised by the Insurance Regulatory Development Authority.

He said the government intends to amend legislation in this regard after consultation with stakeholders.
Presently, over 5 crore workers are covered by mandatory social security schemes run by EPFO.