The EPFO fixed a three-year high interest rate of 8.25% on employees’ provident fund for 2023-24 on February 10.

The Central Board of Trustees (CBT) of the Employees Provident Fund Organisation (EPFO) has recommended an interest rate of 8.25% on provident fund (PF) deposits for 2023-24. The current interest rate is 8.15%.

“The move is a step towards fulfilling PM Modi’s guarantee of strengthening social security for India’s workforce,” said Union Labour Minister Bhupender Yadav after a meeting of the CBT here on Saturday. The meeting also authorised Mr. Yadav to constitute the new executive committee of the CBT.

Also read: The woes of pensioners and PF members 

The CBT has recommended to the Union Finance Ministry that the new interest of 8.25% could be applied to the accumulations in subscribers’ accounts for 2023-24. Once the Finance Ministry accepts the approval, the new rate will be officially notified in the government gazette. “Subsequently, the EPFO will credit the approved rate of interest to its subscribers’ accounts,” the Union Labour Ministry said in a press release.

“The CBT has recommended a distribution of historic income amount of ₹1,07,000 crore to EPF members’ accounts on a total principal amount of about ₹13 lakh crore, which were ₹91,151.66 crore and ₹ 11.02 lakh crore respectively in 2022-23. The total income recommended for distribution is the highest on record,” the Centre said, adding that the income had grown by more than 17.39% and principal amount had increased by 17.97%, which is a healthy financial performance.

The issue of non-inclusion of representatives of the INTUC and the AITUC in the CBT were also taken up during the meeting.

“The EPFO’s apex decision making body Central Board of Trustees (CBT) has decided to provide 8.25% rate of interest on EPF for 2023-24 at its meeting on Saturday,” a source said.

The 8.5% interest rate on EPF deposits for 2020-21 was decided by CBT in March 2021.

ESIC cover for retirees

A meeting of the Employees’ State Insurance Corporation (ESIC) was also held on Saturday. The meeting decided to extend the ESIC’s medical benefits to superannuated insured persons with relaxed norms. Superannuating workers, who were insured under the ESIC but who went out of the scheme coverage in view of exceeding the wage ceiling, will get the benefit if the worker was under insurable employment for at least five years before superannuation or voluntary retirement. “The persons who were in the insurable employment for at least five years after April 1, 2012, and superannuated/voluntarily retired on or after April 1, 2017 with wages up to ₹30,000 per month will be benefited under the new scheme,” the Ministry said.

The meeting also relaxed existing norms for establishment of dispensaries, medical infrastructure, Regional-Sub Regional offices in north-eastern States, including Sikkim. It also approved a new policy on AYUSH 2023 in ESIC institutions. “The policy details the establishing of panchkarma, Kshara Sutra and AYUSH units in ESIC hospitals,” it said. The ESIC will also acquire land for construction of 100-bed hospitals at Udupi in Karnataka, Idukki in Kerala, and for a 150-bed hospital at Malerkotla in Punjab.

New Delhi:

 The economy has added around 5.2 crore new formal jobs between FY20 and FY23, with the net addition being 2.7 crore, according to a report based on an analysis of the EPFO, NPS and ESIC data.

The government has since April 2018 releasing monthly payroll data from the Employees Provident Fund Organisation or EPFO, the National Pension Scheme or NPS and the Employees State Insurance Corporation or the ESIC, based on the recommendations given by Ghosh & Ghosh report.

The EPFO payroll data trends for the past four years show that net new EPF subscriber addition during FY20-23 was 4.86 crore, which consists of new payroll (first payroll), second payroll (rejoined/resubscribed members) and formalised payrolls. Accordingly, the net new payroll (first job/fresh job) adjusted for re-joined/re-subscribed members and formalisation (based on ECR data), shows that the actual net new payroll was 2.27 crore during FY20-23, SBI Research said in a report Tuesday.

Of this, the first jobs were 47 per cent of the total net new payroll addition and the second jobs (the exited members who re-joined and re-subscribed) stood at 2.17 crore during these four years. This means that the net increase in formalisation was at 42 lakh in these years, said the report penned by group chief economic advisor to the SBI Soumyakanti Ghosh.

If the Q1 EPFO payroll data of FY24 looked at the trend, it is encouraging as 44 lakh net new EPF subscribers joined, of which the first payroll was 19.2 lakh. If the trend continues for the rest of FY24, then the net new payroll will cross the 160 lakh mark, which will be the highest ever with the first payroll in the range of 70-80 lakh.

NPS data indicate that 8.24 lakh new subscribers in FY23, of which state government payrolls stood at 4.64 lakh, followed by non-government jobs of 2.30 lakh and 1.29 in the central government.

During the past four years, around 31 lakh new subscribers joined the NPS. That means, cumulatively, total payroll generation of the EPFO and NPS was more than 5.2 crore during FY20-23, Ghosh said.

The report also notes a significant decline in revision of the number of members who have rejoined or resubscribed in the first quarter of the current financial year. This would mean more people may be deciding to stick to their current employment. Additionally, the share of women’s payroll was around 27 per cent.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)