The uncertainty over applicability of a higher rate of interest on EPF accounts continues as the highest decision-making body of the fund manager shied away from passing a resolution.
The Central Board of Trustees (CBT) objected to the finance ministry’s obstruction or taking the matter to the Prime Minister.
Even as some of the CBT opined the issue of 9.5% interest should be allowed to be settled by the Prime Minister, chairman Mallikarjun Kharge chose to calm the tempers by assuring ‘fruitful negotiations with the finance ministry’.
“Where is the need to take it to the PM? Such objections are raised as it involves government procedures and we are here to address them,” Kharge, also the labour and employment minister, said after the meet on Tuesday.
The debate is over a 9.5% interest CBT decided for 2010-11, which is 1% more than the 5.7 crore subscribers, are getting from last five years. The much-publicised decision, which brought cheers, is turning out to be a sour grape for the subscribers.
“The rules say interest is calculated in consultation with finance officials which is what we did. We strongly object the way finance has been persuading us and unanimously stand by our interest rates,” D L Sachdev, secretary, AITUC and member CBT said.
Trade unions suspect the objection as an indirect pressure tactic by finance ministry to make EPFO invest in stock markets, which the CBT is opposed to from a long time. CBT wanted an assurance of guaranteed returns from stock market, but finance ministry said it is not possible.
In Tuesday meeting the CBT members reiterated their stand of keeping away from the ‘volatile and undependable stocks’.