EMPLOYEES PROVIDENT FUND

Inoperative EPF Accounts

The Finance Ministry while recommending adoption of investment pattern notified by them on 14.08.2008 for Employees’ Provident Fund and “Exempt Funds” suggested that liberal advances and withdrawals from Employees’ Provident Fund (EPF) should be shunned to achieve old age income security for employees because by not adhering to “one instrument one policy objective” most employees retire with as little as less than Rs. 35,000/- in their accounts. Ministry of Labour and Employment has replied to the Ministry of Finance mentioning the need for continuation of the provision for partial withdrawal from provident fund account of the subscribers. With effect from 01.04.2011 interest will not be paid on Inoperative Accounts as per Notification dated 15.01.2011 issued by the Ministry of Labour & Employment, Government of India. Data containing number of Inoperative Accounts is not maintained separately. However, total number of Inoperative Accounts has been estimated to be around three crore.

As per the Consolidated Annual Accounts of the Employees’ Provident Fund Organisation for the year 2009-10, an amount of Rs. 8,318.69 crore is lying in Inoperative Accounts.

This information was given by Shri Mallikarjun Kharge, Minister for Labour And Employment in a written reply to a question in the Lok Sabha today.

Source: PIB