Employees Took Out Rs 39,000 Cr From Provident Funds In 180 Days; Maharashtra #1

Recently, we reported that IT employees had already availed the maximum of their EPF advances due to the unprecedented COVID-19 disease outbreak.

And now, the news is that members of the retirement fund body, Employees’ Provident Fund Organisation (EPFO), have availed as much as Rs 39,402.9 crore. This amount was withdrawn between March 25 and August 31 alone, i.e. 180 days alone. 

Highest Number Of Withdrawal In Maharashtra;  Followed By Karnataka, Tamil Nadu

Of the above number, a majority of the withdrawal has been done in Maharashtra with Rs 7,837.8 crore withdrawn. As of today, the number of coronavirus infected patients in Maharashtra is 1097856 with 30409 deaths.

The second state on the highest amount of withdrawal is Karnataka with a withdrawal of Rs 5,743.9 crore, and Tamil Nadu at Rs 4,984.5 crore.

This has been confirmed by the labor minister Santosh Gangwar in a written response to the Parliament. 

The outbreak of the COVID-19 pandemic led to a nationwide lockdown being imposed in India. Like a domino effect, people lost their jobs and had to avail of the employee provident fund to survive during these trying times. 

The minister also said that the Government has implemented various measures under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) and the Aatmanirbhar Bharat schemes to help migrant workers deal with their unemployment. 

Government To Make Amends To EPS: Will Set up Individual Pension Accounts

Additionally, the government is planning to make amends to the Employees’ Pension Scheme (EPS), 1995. Herein, all the new entrants into the scheme will be given individual defined contribution based pension accounts. 

Under this plan, one third of the total EPF contribution on behalf of the new employees along with the monthly salary of more than rupees 15000 will be going to their personal pension accounts rather than the EPF. 

As per reports, employees who have a salary of more than Rs. 15000 per month will have these individualized pension accounts with a defined contribution of 8.33% of the employer’s share of the basic salary plus DA. 

For the employees with lesser income than Rs. 15000, the defined contribution will be inclusive of the employer’s contribution of 8.33%, which won’t be more than Rs. 1250 by definition along with the government’s contribution of 1.6%, which will not exceed Rs. 174 per month.