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Union Finance Minister Nirmala Sitharaman justified the EPFO Central Board of Trustees’ (CBT) decision to decrease the interest rate for the deposit in the Provident Fund. Countering the Opposition charge that a lower interest rate is against the interest of workers, she said 8.1 per cent is the highest interest rate compared to other savings schemes. Sitharaman was replying to a debate in Rajya Sabha on the Appropriation Bills on Monday.
She said the CBT has not changed the interest rate for quite some time and the decision to reduce the rate to 8.1 per cent was taken by the CBT which has representatives of all stakeholders, including trade unions.
“The EPFO has taken a call to keep the rate at 8.1 per cent, whereas rates offered by other schemes including Sukanya Samriddhi Yojana (7.6 per cent), Senior Citizen saving scheme (7.4 per cent) and PPF (7.1 per cent) are much lower. The fact remains these are rates which are prevailing today, and it is still higher than the rest,” Sitharaman said an agreed that the rate remained unchanged for 40 years and the revision will reflect the present realities.
On another charge that the Centre’s policies have resulted in steep increase in fertiliser prices, she said the Centre instead has borne higher cost of urea and did not pass it on to the farmers.
Defence spending
On defence spending and corporatisation of defence factories, she said the situation for country’s defence forces was so helpless during the UPA regime. “Ten years of Indian defence history has recorded no purchases. This made our defence completely disarmed,” she added. On LIC disinvestment, Sitharaman said the embedded value of LIC is calculated in a very scientific way.
The Opposition, during the debate, demanded more tax on the rich. “If the government has to impose taxes to increase revenue, the rich and big players must be taxed more but the poor should be spared. The middle class and the poor have been hit hard by the pandemic and their budget has been disturbed,” Congress MP Shaktisinh Gohil said.
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