EPFO gives the April PF interest rates a miss

In all the hoopla over the ratification of 9.5 per cent interest rate for Employees Provident Fund (EPF) subscribers for 2002-04 and a declaration by the labour minister, K Chandrashekhar Rao, that it would be extended for the last fiscal too, the rate for the current financial year has been forgotten.

No interest was credited in the accounts of subscribers for the month of April, 2005 as the board meeting to decide on the rate for April was not held this year.

The EPF organisation's (EPFO's) central board of trustees headed by the labour minister has not declared the rates for the year 2005-06 so far.

The rates should have been declared by February-end or mid-March. However, it has been one month since the new financial year began and the board has not yet met for discussing the issue of interest rates on provident fund.

A senior board member confirmed that the rates were yet to be decided. "Retiring employees will not get any interest for the year 2005-06 as the rates are yet to be decided," he said. The money will of course, be forwarded to their bank accounts later when the rates are decided and ratified.

As a matter of procedure, the central board of trustees declares the rates for a particular year, which is later endorsed by the finance ministry. The rates are decided upon in the board's meeting after which they are formally declared.

A meeting was supposed to be held on March 20 but was later cancelled. With this, any outgoing member will not be given any interest for the month of April 2005, the member informed.

Officers in the labour ministry admitted that the EPFO is going through one of its worst crisises in the last five years.

The regional provident fund offices across the country should have begun issuing account slips for the current year, but they haven't been issued for the last two years on account of the interest imbroglio. The account slips are a record of the balance in an employee's PF account.