The Finance Ministry’s decision to reduce the interest rate on the Employees’ Provident Fund (EPF) attracted Opposition criticism in the Rajya Sabha on Thursday.

EPF Interest Rate

Raising the issue during Zero Hour, CPI(M) member Tapan Kumar Sen slammed the “unilateral, undemocratic” action by the Ministry, saying it had completely ignored the unanimous decision of the tripatite body of the EPFO, which is headed by Union Labour Minister himself.

The committee had taken an interim decision that an 8.8 per cent interest rate would be offered on EPF, with an indication that it could even be increased, Sen said.

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“Unfortunately, not to speak of further raising it, the Finance Ministry cut it down to 8.7 percent,” he said, adding that the money belongs to 4 crore workers and the government does not contribute to it.

He claimed that the move was part of an “overall project of the government to do away with the Provident Fund system altogether as a part of their project of ensuring ease of doing business.”

The CPI(M) member said the government is planning to make EPF optional. Earlier the government had to roll back tax on EPF withdrawal, he added.