STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (d) OF LOK SABHA STARRED QUESTION NO. 213 FOR 27.08.2012 BY SHRI SANJAY BRIJKISHOR LAL NIRUPAM REGARDING EMPLOYEES PROVIDENT FUND ORGANISATION.
(a): The details of Employees’ Provident Fund Organisation (EPFO) funds invested in private sector, non-banking companies during the last three years and current year (upto 22.8.2012) and returns on these investments are given below:
[figures in Rupees in crore]
| Year | Amount Invested | Average rate of return (%) |
| 2009-10 | 578.43 | 8.87 |
| 2010-11 | 2,434.41 | 9.05 |
| 2011-12 | 1,163.59 | 9.67 |
| 2012-13 (as on 22.8.2012) |
Nil | – |
(b) to (d): Finance and Investment Committee (FIC) of Central Board of Trustees, Employees’ Provident Fund [CBT,EPF] is not the decision making body but only a recommending body to CBT, EPF for investment of EPFO fund. The CBT, EPF frames investment guidelines for investment decisions of EPFO within the pattern of investment prescribed by the Central Government.
FIC, in its 109th meeting held on 23rd May, 2012, had made following recommendation to the CBT, EPF for consideration:
A. Recommendation for changes in Pattern of Investment:
B. Recommendation for changes in Investment Guidelines of CBT
| S.No. | Recommendations | Reasons |
| 1. | Consider expanding of Investment Universe for bonds of private sector Companies fulfilling the following criteria: a) Listed b) Dual AAA Rating c) 25% Dividend during last 5 Years d) Continuous net profit during last 5 Years e) Positive Networth of minimum of Rs 5000 crore. f) The maximum tenure for investments in Private Sector non banking companies be uniformly restricted to maximum 10 years in place of existing maximum 15 years. g) There should be restriction in foreign shareholding of the eligible company. |
Increasing the investment basket in the private sector companies category without compromising security and safety of the investments so as to realize higher yields. |
Details of Lok Sabha Q&A:-
STARRED QUESTION NO 213 by Shri SANJAY BRIJKISHORILAL NIRUPAM
Will the Minister of LABOUR AND EMPLOYMENT be pleased to state:-
(a) the details of the Employees Provident Fund Organisation (EPFO) funds
which were invested in private sector, non- banking companies during the last
three years and the current year and the returns received from these
investments;
(b) whether the EPFO`s Chief Investment advisory body Finance
and Investment Committee (FIC) has taken a decision to lower the maximum tenure
for investment in private sector, non-banking companies to ten years;
(c) if
so, the details of the major decisions taken by the FIC along with the reasons
therefor; and
(d) the reaction of the Government thereto?
ANSWERED ON 27.08.2012
ANSWER by MINISTER OF LABOUR AND EMPLOYMENT (SHRI MALLIKARJUN KHARGE)
(a)
to (d): A statement is laid on the Table of the House.
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