EPFO backs plan to allow subscribers’ NPS switch
New Delhi: The Employees’ Provident Fund Organisation has supported a labour ministry proposal to allow its subscribers switch to the National Pension System but said the move needs to be backed by suitable amendments to the Pension Fund Regulatory and Development Authority Act.
The retirement fund body wants the PFRDA act to be amended to allow those who opt for the National Pension System to return to the Employees’ Pension Scheme under the EPFO, which is currently not possible, a senior government official told ET. The National Pension System (NPS) is a voluntary, defined contribution programme administered and regulated by PFRDA.
The Central Board of Trustees of the EPFO, chaired by the labour minister, is likely to meet next month to deliberate over the proposed amendments, following which the retirement fund body’s view will be finalised. The labour ministry had called for a tripartite meeting last month on the proposed amendments to the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, which 10 central trade unions boycotted.
The Central Board of Trustees, comprising representatives of employees and employers besides people from the Centre and the state governments, will consider the EPFO’s views before the matter is sent to the labour ministry.
The RSS-affiliated Bhartiya Mazdoor Sangh, which was one of the few trade unions that attended the meeting, rejected the proposal outright, saying NPS is not on a par with the Employees’ Pension Scheme and there is no certainty on the rate of return. The labour ministry moved a draft amendment to the Employees’ Provident Funds and Miscellaneous Provisions Act on August 23, proposing to allow EPFO subscribers to opt for NPS instead of the Employees’ Pension Scheme.