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COVID-19 badly hit salaried class; Rs 39,400 crore withdrawn from provident fund in 5 months

Of the 10.4 million salaried employees who withdrew their retirement savings in this period, at least 8.2 million were those who earn less than Rs 15,000 per month

twitter-logoBusinessToday.In | September 15, 2020 | Updated 11:39 IST
COVID-19 badly hit salaried class; Rs 39,400 crore withdrawn from provident fund in 5 months

Salaried employees under the Employees' Provident Fund (EPF) withdrew Rs 39,400 crore between March 25 and August 31 as livelihoods took a hit amid the coronavirus pandemic, the Union Labour Ministry said in the Lok Sabha on Monday. More than 40 per cent of Rs 39,400 crore were withdrawn from Maharashtra, Tamil Nadu and Karnataka. EPF subscribers in Maharashtra withdrew Rs 7,837.85 crore, while Rs 5,743.96 crore were withdrawn in Karnataka and in Tamil Nadu and Puducherry together Rs 4,984.51 crore were withdrawn.

Of the 10.4 million salaried employees who withdrew their retirement savings in this period, at least 8.2 million were those who earn less than Rs 15,000 per month. This is reflective of the challenges faced by the lower rung of the pyramid.

The withdrawal of Rs 39,400 crore is almost 30 per cent of the Employees' Provident Fund Organisation's (EPFO) annual accruals.

Labour Minister Santosh Gangwar also said that the government took various measures under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) and Atma Nirbhar Bharat schemes to mitigate the distress of migrant workers. He said that the government pledged to pay 12 per cent of employers' share and 12 per cent employees share under EPF, amounting 24 per cent for six months from March to August for organisations having up to 100 employees. In such organisations, 90 per cent employees must earn less than Rs 15,000 wage.

Gangwar said that the government also reduced EPF contribution from 12 per cent to 10 per cent of wages for May, June and July.

Earlier the EPFO had said that the organisation has been settling claims within three days. "PF accumulations are now seen as liquid assets that can timely meet the need of the subscribers during crisis," said the EPFO.

Also read: EPFO to pay interest in two instalments; raises deposit linked insurance benefits to Rs 7 lakh

Also read: EPFO disburses Rs 35,445 crore against 94.41 lakh claims till August

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