Retirement fund body EPFO has no plans to launch a housing scheme for its over five crore subscribers on additional contribution by its members, Parliament was informed today.
“No Sir,” Labour Minister Bandaru Dattatreya said in a written reply to the Rajya Sabha on a question whether Employees’ Provident Fund Organisation (EPFO) has chalked out a scheme for providing housing to its subscribers on additional contribution.
The idea to provide housing by EPFO on additional contribution 10 per cent of subscribers’ basic wages was mooted earlier this year by Labour Minister Oscar Fernandes during a function of the body in January.
Addressing the gathering, Fernandes who was also heading the EPFO trustee’s board had said, “EPFO can deduct extra 10 per cent of their basic wages over the mandatory contribution of 12 per cent made by them at present. The money can be used to provide them housing facility.”
The Minister had also said, “Most of the workers throughout their working life live in rented accommodation and their entire saving on retirement is spent on purchasing a house.”
At present, all workers covered under the EPFO schemes, pay 12 per cent of their basic wages toward PF contribution every month. The basic wages include basic pay and dearness allowance.
On the occasion, EPFO’s central Provident Fund Commissioner K K Jalan had said: “We will definitely work on the proposal. He (the minister) has a lot experience.”
According to information available, EPFO had earlier constructed a few houses and provided to workers covered under its scheme during the tenure of late Sahib Singh Verma as Labour Minister. However, they did not have to make any additional contribution during that time.
A senior official said that the body has huge financial strength to take up any such housing scheme for its subscribers but how many of them would be ready to take a cut of 10 per cent of basic wages.
EPFO has a corpus of around Rs 6 lakh crore and receives incremental deposits of over Rs 70,000 crore every year. A large chunk of EPFO funds are invested in central and state securities.