Steps to increase PF revenue

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 The issue of  increasing the PF pension to its subscribers who are surviving at Rs. 1,000/- p.m. pension at the present time of inflation is getting momentum. Govt. is considering taking steps to increase the revenue on account of PF subscriptions by various steps. I would like to share my views on the same.   

As per EPF Act, it is mandatory for any organization employing 20 persons or more to register under the EPF scheme. If less than 20 are employed, company can opt to register under the scheme. 

The working of this condition is quite different. It  often so happens that when more than 20 persons are to be employed, new companies gets floated by the some company with some other name and thus new employees get appointed in that new company. Such companies do not have any locus - standi or may be doing some other business, to be named as shell companies..  By doing in this manner, they save employer's contribution to PF on the one hand and depriving such employees of the benefits of the scheme. It also effects adversely the revenue of the PF establishment which in turn reduces the pension prospects of such employees in the organized sector.

Govt. should review of the existing scheme and reduce the eligible employees strength of 20 to the minimum. A much needed effort is needed for better governance and accountability of the scheme. It will certainly increase the revenue of PF establishment on the one hand and better financial security to the retired employees and strengthen organised sector.    


                                                


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