Trade unions against providing option between EPF, NPS

Trade unions today strongly opposed government's proposal to provide an option to formal sector workers to choose between the Employees Provident Fund and the New Pension Scheme, saying the latter does not have definite benefits.
The trade union representatives including from the BJP-backed Bharatiya Mazdoor Sangh (BMS) asked the government to give an option first to government employees who are covered under the New Pension Scheme (NPS).
"We have asked them how NPS is better than EPF scheme run by the Employees' Provident Fund Organisation (EPFO). Their reply was not satisfactory," BMS Zonal Organising Secretary Pawan Kumar said after an informal meeting called by the Labour Ministry.

He said, "EPF scheme has definite benefits like EPF, pension, insurance, widow pension, orphan pension and children pension. These are not available in the NPS."
The proposal is part of the Labour Ministry's move to comprehensively amend the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.
The proposal was incorporated in the draft bill on EPF & MP Act after Finance Minister Arun Jaitley made an announcement regarding providing option to formal sector workers to choose between the NPS and the EPF.
"It has been remarked that both EPF and ESI have hostages, rather than clients. Further, the low paid worker suffers deductions greater than the better paid workers, in percentage terms...With respect to the Employees Provident Fund (EPF), the employee needs to be provided two options... the employee may opt for EPF or the NPS," Jaitley had said in his Budget speech.

All India Trade Union Congress Secretary D L Sachdev said, "The two schemes are not comparable because EPF scheme has definite contribution and definite benefits. NPS is savings scheme which cannot be compared to a social security scheme like EPF.