Employees subscribing to provident fund have not been able to exploit the entire benefit due to cumbersome procedure and a general lack of awareness of the rules. Now, through the efforts of experts and the organisation, much could change
Provident fund in India is a well-known concept for income security. But despite it being in existence since a long time, there is a lack of transparency. Many of us have little knowledge about our provident fund (PF) account. Experts are demanding a change in the PF policy, to make it more employee-friendly.
The Employees' Provident Fund Organisation (EPFO), India, is the largest governing body of provident funds. Contributing to the employees' provident fund (EPF) account is easy, but the withdrawal process is harrowing.
Let alone clueless employees, even the human resources departments of many private organisations are quite unaware of the EPF rules and regulations. For instance, they don't know that an employee could contribute more than the standard provident fund amount deduction, although the employer will not increase his share of the contribution.
Industry experts are also demanding one standard EPF account number for each employee throughout his/her career. Currently, when an employee shifts an organisation, he/she is given a fresh account. A standard provident fund number would ensure that the contributions are not spread over different EPFOs and would at the same time earn good compounded returns, with the interest rate at a high 9.5%.
Speaking to Moneylife YS Kataria, director (media and communication), Ministry of Labour and Employment, said, "We are working on a process where all the account holders will be provided with a unique EPF number, like the unique identification number. This process will be worked out in the next six months."
At the time of withdrawal, an employee needs to go to his previous employer. And the local provident fund office directs the employee to the EPFO where the establishment is registered. Experts say, "The PF should be accessible through the local provident fund office and the employee should not have to go through the human resources department of the previous organisation."
This issue could be resolved shortly, as the EPFO announced recently that subscribers of EPFO would soon be able to monitor their accounts online. "The employee would not have to go back to his previous employer once the EPF subscriber can see his account details online," Mr Kataria explained.
Many people are generally uninformed about their EPF contribution. This results in the premature closure of the account as they don't want to go to their previous employer and they are also unaware of the procedures. Even the EPFO has decided to stop interest payment on the employee PF accounts where there is no activity seen over a prolonged period. In this matter, industry analysts believe that premature withdrawal of funds should be charged a penal interest and employees should be made aware of the importance of continuing the account to avail of better returns later on.
The most common complaint against the EPFO is that account holders do not get any answer to their queries. But consumer activists point out that the problem can be overcome by the account holder invoking the Right to Information (RTI) Act to get details of the EPF account, without having to go to the EPFO office.
Experts also point out that sending periodic statement details of the PF account to contributors, even if the account is in another city, would ensure better transparency.
Other initiatives, like educating people through vernacular advertisements about the rules and regulations of EPF and providing a smart-card option, would also help people to understand better about the PF policy.
"We have initiated a lot of awareness to discourage premature withdrawals. Also with all the details being made available online, such problems will be reduced," Mr Kataria said.
Earlier, the then oil minister Murli Deora was accused of delaying approval for the transaction, but he moved to the corporate affairs ministry in late January and there is still no sight of a decision
New Delhi: A ministerial panel is likely to decide tomorrow if the government should approve Cairn Energy's sale of stake in its Indian unit to mining group Vedanta Resources with conditions or without any precondition, reports PTI.
The Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee is scheduled to hold its first meeting at 1630 hours on 27th May, an oil ministry official said today.
The Cabinet Committee on Economic Affairs (CCEA) had on 6th April asked the GoM to vet the $9.6 billion deal, but the panel has not held a single meeting in seven weeks since then.
Earlier, the then oil minister Murli Deora was accused of delaying approval for the transaction, but he moved to the corporate affairs ministry in late January and there is still no sight of a decision.
Industry sources said they were apprehensive about the prospects of the GoM arriving at any decision tomorrow as key oil ministry officials—special secretary PK Sinha and joint secretary exploration DN Narasimha Raju—who have been dealing with the subject for the past nine months, are on official tour abroad.
Oil secretary GC Chaturvedi, who came to the ministry of petroleum and natural gas only this month, is still grappling with the subject while oil minister S Jaipal Reddy is also relatively new to the job.
Sources said things have also become complicated for the GoM after Solicitor General Gopal Subramaniam reaffirmed his earlier opinion that the government can impose preconditions like asking Cairn or its successor to share cess and royalty with state-owned Oil and Natural Gas Corporation (ONGC) in the all-important Rajasthan block.
In his second opinion, which was sought by Mr Mukherjee, the SGI said, “The government is not bound to grant consent ipso facto or mechanically.”
The precondition that Cairn/Vedanta agree to cost-recovery of Rs18,000 crore in royalty that ONGC has to pay on the Rajasthan block would be “defensible on parameters of public and national interest,” the SGI said in the second opinion.
Sources said the GoM itself is split in the middle on the issue of treating royalty paid by ONGC as cost-recoverable from its revenues. While Mr Reddy has played it safe by giving an alternative to ONGC’s demand, which was originally made a month before the Cairn-Vedanta deal was announced in August last year, the law ministry and Planning Commission have backed making cost-recovery of royalty a precondition for approval.
The finance ministry is in favour of Mr Reddy’s second option of the government giving consent without any precondition and taking appropriate decisions to protect ONGC’s interests.
It remains to be seen if Mr Mukherjee will sideline the SGI opinion in approving the deal.
In his first opinion on 24th March, the SGI had categorically stated that the transfer of Cairn India shares to Vedanta should be allowed only if the latter agrees to preconditions on the deal.
For the year ended 31 March 2011, standalone net profit of Ind-Swift Laboratories increased to Rs87.61 crore from Rs5,796 crore in the previous year
Drug maker Ind-Swift Laboratories Ltd said its consolidated net profit grew 58.69% to Rs89.47 crore in the year ended 31 March 2011, over the corresponding period a-year-ago.
The group had a consolidated net profit of Rs56.38 crore in the last fiscal, Ind-Swift Laboratories said in a filing with the Bombay Stock Exchange.
Referring to the robust growth, vice-chairman and managing director NR Munjal said it was due to its strong product pipeline and successful accreditation of the company’s manufacturing facilities by the Japanese and Korean Regulatory Authorities.
He further said that the company’s focus on exports to regulated and semi-regulated markets of the US, Japan and Europe had also resulted in adding to the overall growth.
The group’s consolidated total income climbed up by 32.34% to Rs1,048.52 crore in the year under review from Rs792.26 crore in the same period last year.
For the year ended 31 March 2011, standalone net profit of the company increased to Rs87.61 crore from Rs5,796 crore in the previous year.
Standalone total income of the firm rose to Rs1,031.20 crore in the year under review from Rs790.52 crore
For the fourth quarter ended 31 March 2011, its standalone net profit surged to Rs26.39 crore from Rs20,75 crore in the same period last fiscal.
Standalone total income increased to Rs305.22 crore in the three-month period under review from Rs201.27 crore in the March quarter previous year.
The board of directors at its meeting held recommended a dividend of Re1 per equity share of Rs10 each of the company.
On Thursday, Ind-Swift Laboratories ended 1.21% up at Rs50.35 on the Bombay Stock Exchange, while the benchmark Sensex gained 1.11% to 18,044.64.