EPFO deposits soar as more workers are brought under PF ambit

The Employees Provident Fund Organisation (EPFO) has estimated an increase of over 14 per cent in its incremental deposits for this financial year at Rs79,377 crore.

In its meeting on Saturday, the EPFO's Central Board of Trustees (CBT) approved the revised estimates for 2014-15 as contributions showed an increase.

However, the EPFO's administrative charges are expected to be at Rs4,905 crore in 2014-15, which is an increase of almost 16 per cent over the last financial year.

The EPFO, more commonly known by workers simply as PF, had received Rs71,195 crore as incremental deposits from its over five crore subscribers under social security schemes run by it during 2013-14, which was 16 per cent higher than the Rs61,143 crore collected by it in 2012-13.

Out of the Rs79,377 crore contribution this fiscal, it is estimated Rs59,346 crore is expected as provident fund contribution, Rs19,000 crore as pension contribution and Rs1,031 as Employees' Deposit Linked Insurance Scheme contribution.

A senior official said that the estimates are based on the contributions received so far and could be even higher in view of enhancement of monthly wage ceiling to Rs15,000.

The body has enhanced the wage ceiling for becoming a member of the EPFO at the time of taking up employment to Rs15,000 per month from Rs6,500. The decision was made effective from 1 September.

According to EPFO estimates, the enhanced wage ceiling is expected to bring an additional 50 lakh workers under the ambit of social security schemes run by the EPFO and enhance the incremental deposits substantially.

It is expected that the incremental deposits may touch Rs1,00,000 crore in the next financial year.

At present, the EPFO is managing a fund size of over Rs6,00,000 crore. It has provided 8.75 per cent rate of return on PF deposits for the current as well as previous fiscal.

The union finance ministry ratified the 8.75 per cent rate of interest on PF deposits recently, paving the way for retaining the same rate of interest in the current fiscal as provided in 2013-14.