EPFO board meeting today: Major announcements worth watching

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New Delhi: The meeting of the Central Board of Trustees of the Employees’ Provident Fund Organization will be held on November 20. The board will meet for the 229th time.

The Board is a Government created statutory body established under Section 5A of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952. It is made up of government officials, workers and employers.

Investment

Expansion of investment portfolio of EPFO ​​to include hitherto undiscovered investment opportunities will be an important agenda item. Alternative Investment Funds (AIFs) and Infrastructure Investment Trusts (InvITs) are among the options that are expected to be studied.

At present, the EPFO ​​can invest 45-50% of its incremental deposits in government securities, 35-45% in debt instruments, 5-15% in equities, up to 5% in short-term debt instruments and up to 5%. Asset-backed, trust-structured, and other investments.

In April of this year, the labor ministry announced amendments to investment options, including the addition of units issued by Securities and Exchange Board of India-regulated Category I and Category II AIFs.

hike in minimum pension

An important topic during the meeting is expected to be increase in minimum pension. The board of directors may decide to increase the minimum pension to Rs 3,000.

According to the central trade unions, the minimum pension should be increased from Rs 1,000 to Rs 6,000.

The Parliamentary Standing Committee on Labor, headed by Biju Janata Dal MP Bhartrihari Mahtab, suggested that the minimum pension of the Employees’ Pension Scheme be increased from Rs 1,000 to Rs 3,000. In its findings, the committee noted that the minimum pension, which was announced in 2014 and is still in effect, is inadequate.

Rate of interest

The board of directors may talk about the interest rate for the current financial year (2021-2022).

The EPFO ​​board on March 4 suggested 8.5 per cent interest for provident fund deposits for FY21, which was approved by the finance minister on October 29. For FY20, EPFO ​​slashed the interest rate on provident fund deposits to an all-time low of 8.5 per cent. ,

The interest rate was 8.65% in FY19, 8.55 percent in FY18 and 8.65 percent in FY17.

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