Proposal to increase EPFO equity investment limit increase not considered

A proposal to discuss the quantum of investment from the employees’ provident fund in equity this fiscal did not make it to the meeting of the Central Board of Trustees of the Employees Provident Fund Organisation (EPFO) on Saturday with the government appearing to take a cautious route before finalising it.

Sources said the proposal did not make it to the meeting though it was initially on the agenda. Usually, 15 per cent of the funds are put in the equity market by the EPFO.

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However, sources said, there is a thinking in the government that employees invest in the provident fund believing that their investment would grow and do not foresee the possibility of their investment dwindling if the market conditions are not favourable. Further, the EPFO has not issued any warning to its subscribers about the possibility.

Against this background, sources said that the finance committee should have further conversations within to decide on future investments, as it is considered a sensitive issue. There is also a view within the government that there should not be a further fall in EPF interest rates and in such a scenario, the investment should be made with care.

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At the meeting chaired by Labour and Employment Minister Bhupendra Yadav, the Central Board of Trustees decided to revamp its Standing Committees on Finance, Pension and Exempted Establishments revamped. It was also decided to include a subject expert in all committees.

A new Standing Committee on human resources will also be set up. A draft Vision Document 2047, which has set out milestones for the EPFO at five-year intervals, has also been shared with the members who have been asked to review it and provide suggestions.