New Delhi : The Finance Ministry today agreed to increase interest rate on provident fund deposits to 8.8 percent from the 8.7 percent due to ongoing pressure from the trade unions.
The rollback comes after the Finance Ministry and the Labour Ministry were locked in an intense tussle over the rate of interest on EPF deposits for 2015-16 with the former pegging the rate at 8.7 percent, 10 basis points lower than decided by the EPFO.
The Finance Ministry also defended its decision to pay 8.7 percent interest on EPF, saying last year’s surplus would have to be used to pay this rate.
Opposing the lowering of interest rate, as many as 10 central trade unions decided to hold a day-long protest against the Finance Ministry’s decision.
Union Labour Minister Bandaru Dattatreya had earlier justified his ministry’s decision to declare an 8.8 percent return on EPF savings. (ANI)