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Our Bureau

New Delhi, July 29 In a move that may have far-reaching impact on the future income of the Employees Provident Fund Organisation (EPFO), the largest provident fund in the country on Tuesday decided to induct three private sector fund managers — the Anil Ambani-led Reliance Capital AMC, HSBC AMC and ICICI Prudential AMC — as its new fund managers.

This ends the age-old monopoly of State Bank of India, which will, however, continue as the sole public sector fund manager.

The organisation has a corpus of about Rs 1,55,561 crore (at face value) as on March 2007 and around four crore subscribers.

The inclusion of Reliance came as a last minute surprise as the company did not figure in the recommendations placed before the Central Board of Trustees (CBT) by its Finance and Investment Committee (FIC).

The FIC had recommended only two private sector players. The Labour Secretary, Ms Sudha Pillai, told reporters after the meeting that “the CBT has decided to allow Reliance Capital, ICICI Prudential, HSBC and SBI to manage provident fund of employees.”

Officials said that SBI and Reliance had the same score in the financial bid, but SBI had a better technical bid evaluation with 81 points out of 100 while Reliance had scored 77 out of 100. The CBT took the decision based on the financial bid, they said.

The CBT Member and Secretary of the Hind Mazdoor Sabha, Mr A.D. Nagpal, who is also a member of the FIC, told Business Line after the meeting that “The FIC had not recommended Reliance. We have put our dissent on record,” he said.

According to the bids approved on Tuesday, Reliance and SBI will get an investment management fee of 10 paisa for every Rs 1,000 managed (0.01 per cent). ICICI Prudential and HSBC AMC will receive 7.5 paisa and 6.3 paisa, respectively, for every Rs 1,000 managed by them.

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