Don't cancel partial withdrawal from EPF

New Delhi: The Labour Ministry today favoured the provision allowing subscribers partial withdrawal of money from Employees Provident Fund(EPF) to continue and also said there is no move to impose a lock-in period.

The Labour Ministry stand on partial withdrawal came in response to a suggestion by the Finance Ministry that liberal advances and withdrawal from EPF account should be shunned to help achieve old-age income security for employees.

"Ministry of Labour and Employment has replied to the Ministry of Finance mentioning the need for continuation of the provision for partial withdrawal from provident fund account of the subscribers," Labour and Employment Minister Mallikarjun Kharge said in the Lok Sabha.

The Finance Ministry is of the view that by not adhering to "one instrument, one policy objective" most employees retired with as less as Rs. 35,000 in their account.

In a written reply, he also said there was no move to impose a lock-in period for EPF withdrawal.

However, he said as per a notification issued January 15 this year, interest will not be paid on inoperative account from April 1.

He said the total number of inoperative accounts was estimated to be around three crore, with an amount of Rs. 8,318 crore lying in such accounts as of March 31, 2010.

Source: Financial Express