The government is likely to change the salary cap for the flagship retirement savings programme of the Employees' Provident Fund Organization (EPFO). The Employees' Provident Fund (EPF) scheme's monthly wage cap is currently set at Rs. 15,000. According to The Economic Times, a committee will be formed to decide on a greater wage ceiling.
If the salary ceiling is changed, both employers and employees will have to make more of a contribution. The government contributes 1.16 percent to the Employees' Pension Scheme for every worker, with the wage limit set at 15,000, and the employer matches these contributions with a matching contribution of 12 percent of each employee's basic salary. 8.33 percent of the employers' 12% share goes into the beneficiary's pension account.
The wage ceiling under the EPFO has been revised only eight times since the inception of the scheme in 1952. It stood at ₹300 in 1952, ₹500 in 1957, ₹1,000 in 1962, ₹1,600 in 1976, ₹2,500 in 1985, ₹3,500 in 1990, ₹5,000 in 1994, ₹6,500 in 2001 and ₹15,000 since 2014 onwards. (Also Read: Bisleri confirms selling Rs 7000 crore stake to Tata Group: Report)
The Employees' Provident Funds and Miscellaneous Provisions Act, 1952, assigns EPFO the primary responsibility for providing social security coverage to the organised sector workforce in India. It provides a variety of services to its members, such as a provident fund, pension benefits for members upon retirement, family pensions, and insurance coverage for members' dependent families in the event of an unexpected death.
According to the Employees Provident Fund Organisation's (EPFO) provisional payroll statistics issued on Sunday, the EPFO added 16.82 lakh net subscribers in September 2022, a 9.14% rise in net membership over the same month in the previous year, 2021.
The net enrolment for the month is 21.85% greater than the monthly average that was observed during the previous fiscal.
The Employees' Provident Funds and Miscellaneous Provisions Act, 1952, assuring social security coverage for its employees, has been implemented by around 2861 new companies, according to the Ministry of Labour and Employment.
