Finance Minister Nirmala Sitharaman acknowledged his concerns about the return of the Employees’ Provident Fund (EPF) falling to a more than four-decade low of 8.1% in 2021-2022. other savings instruments were even lower.
Responding to Rajya Sabha MPs flagging the reduction of the EPF rate from 8.5% to 8.1%, Ms Sitharaman said she appreciated and acknowledged their point on the decision, while stressing that it had been approved by the central board of the EPF organization, including representatives of employees, management and government.
“The Sukanya Samriddhi Yojana [rate] stands at 7.6%, the savings plan for seniors at 7.4%, the PPF (Public Provident Fund) at 7.1%, the State Bank of India’s highest rate for five to ten-year fixed deposits at 5.5% and it has a seniority markup, which brings it to 6.3%,” the FM said. “Government’s own loans amount to 6.28% on average over various maturities. With all this, the EPFO has passed a call to keep it at 8.1%,” the minister said.
“It has yet to come to the Ministry of Finance for approval, but the fact remains that these are the rates in effect today and are still higher than the rest of the (instruments),” Ms Sitharaman said in response to the debate over the Bill on Appropriation in the Senate.