Mumbai: The central government has notified payment of 8.50 per cent interest
on employees provident fund deposits for the year 2006-07, which would benefit
over four crore EPF subscribers. "The
central government has notified the rate of interest for the year 2006-07 at 8.5
per cent," central provident fund commissioner A Viswanathan said. The
Central Board of Trustees of EPF had, in July, recommended the 8.5 per cent rate,
despite opposition from trade unions that were seeking higher returns at a time
when even bank fixed deposits were paying attractive interest rate. The
EPF board of trustees had in July, agreed to continue paying 8.5 per cent interest
rate to the subscribers for fiscal 2006-07, amid pressure from the Left-backed
trade unions. The
decision to maintain the 8.5 per cent interest rate will put a burden of Rs450
crore on the EPF. However, according to sources, the deficit could be offset from
a surplus of Rs590 crore lying in the interest suspense account, contingency reserve
and special reserve fund. The
total interest outgo for 2006-07 will be to the tune of Rs7,800 crore. Even after
paying 8.5 per cent interest EPF would have a surplus of Rs83 crore. The
EPF has a corpus of Rs94,000 crore including pension fund.
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