The employees Provident Fund Organisation (EPFO) has decided that its corpus of around Rs 3.5 lakh crore will now be managed only by the State Bank of India (
SBI ) and the private sector investment managers will be kept out for at least the three-month period between April-June as part of an interim arrangement.
Labour minister Mallikarjun Kharge said that the
EPFO 's Central Board of Trustees (CBT) at a meeting held on Wednesday turned down the proposal to give three months extension to the other three fund managers - ICICI Pru, HSBC and Reliance Capital who have also been managing the corpus until now. "It has been decided that SBI alone will manage the entire retirement fund of the 4.71 crore EPFO subscribers for the interim period of three months beginning April 1," the minister said.
The term of the four fund managers was scheduled to expire on March 31. The EPFO had planned to appoint new fund managers for the next three financial years beginning April 1.
The CBT headed by the Union labour minister came to this interim arrangement as EPFO is yet to complete the process of appointing new fund managers.
EPFO had initiated the process last year when it hired credit rating agency Credit Rating and Information Services of India Ltd.
(Crisil) for appointing and monitoring the performance of the new fund managers.
The labour ministry has been proceeding very cautiously on the issue had sent the EPFO tender document to the Central Vigilance Commission (CVC) for clearance as it does not want to run into any controversy at a time when the image of the UPA government has taken a battering due to a spate of scams. As many as 11 asset management companies (AMCs) have shown an interest to manage EPFO's funds which get additional deposits to the tune of Rs 30,000 crore every year.
EPFO had engaged private fund managers for the first time in July 2008 before which SBI was the sole manager of the fund.
EPFO has also decided to rename 'Interest Suspense Account' (ISA) as 'Interest Account', in order to clear the confusion over whether it is a regular account or not.
"We have decided to remove the word 'suspense' from Interest Suspense Account to bring more clarity and soon the legislative amendments would be done to make it effective," an EPFO official said.
The issue had triggered major differences between the finance ministry and the labour ministry when the EPFO had decided to announce a higher rate of return of 9.5 per cent as it wanted to pass on the benefit of the Rs 1,731 crore surplus, which had been found in the ISA during the examining of the accounts.
Courtesy: Mail Today
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