EPF act amendment draft in 3 months

 The government-appointed working group to amend the 60-year old employee
provident fund act, is expected to submit a draft bill in the next three
months. The draft would be thereafter open for public comments, said
Samirendra Chatterjee, Central Provident Fund Commissioner, ministry of
labour and employment, at a seminar by the Indian Chamber of Commerce.



The EPF Act was enacted for creating provident funds for the employees in
working in factories and establishments, with the objective to make
financial provisions for the future security of the industrial workers after
retirement. The EPFO was also planning to modify some of its existing
schemes, like converting the Empoyees’ Deposit Linked Insurance (EDLI)
Scheme into a group insurance scheme, said Chatterjee. This apart, it is
also contemplating incorporating annuity in pension schemes, he added.



Also, EPFO is planning to block PF accounts unclaimed for more than five
years, though the interest accumulated will be paid at the time of
withdrawal. “We are planning to block unclaimed accounts, so as the interest
is not paid on a regular basis. This will reduce the cost of maintaining the
accounts. However, we will pay the interest accumulated at the time of
withdrawal of money,” Chatterjee said.

There are about 20 million unclaimed PF accounts with the EPFO, with a sum
of about Rs 15,000 crore. Out of this, about half the accounts have less
than Rs 1000 as balance, according to Chatterjee.



EPFO has also initiated the exercise of computerising all its regional
offices, and simplifying the process of return, to reduce the time period
between submitting the claim form and return to one week.



The board recently approved Rs 96 crore for implementation of the first
phase of the computerisation plan. About 27 EPFO offices would be
computerized by March 2010 in the first phase.