New EPFO guidance poses further issues
Concerns have been expressed by both activists and workers in response to the EPFO's recent circular on the Employees' Pension Plan (EPS), Read to know more!
Concerns have been expressed by both activists and workers in response to the EPFO’s recent circular on the Employees’ Pension Plan (EPS). The circular has reduced the amount of time that EPS members have to transition to the new pension plan.
According to the early February circular, EPS members who joined before the first of September 2014 can choose to move to the Atal Pension Yojana (APY). The government introduced the APY, a brand-new pension programme, in 2015. According to the circular, members who want to transfer to the APY must do so before March 31, 2023.
Activists are worried about the short window of time allowed to EPS members to exercise their option, though. They contend that given the short deadline and the possibility that many employees are unaware of the switch option, they do not have enough time to make an informed choice.
For workers in the organised sector, there is a pension plan backed by the government called the EPS. After retirement, the programme offers workers a pension. However, the programme has already come under fire for its low pension amount and other restrictions.
A consumer activist from Chennai named M. Somasundaram claims the circular is unclear because no example of an estimated pension payment for an EPS member has been provided. In order to transfer a certain sum of money from his Provident Fund account to the general Pension Fund, a willing member must use his or her choice in conjunction with their employer. Such a member would not wish to exercise the choice in the absence of the necessary information, Mr. Somasundaram notes, hoping that the authorities will quickly resolve the issue.