New Delhi: The Narendra Modi government has decided to defer the new rules restricting provident fund withdrawals till retirement. According to Ministry of Labour and Employment, the relaxed norms will enable people to withdraw their PF for housing, medical emergency, education of children and for their marriage purposes.
Also a notification issued by the Labour Ministry mentioned that the time given for restriction on withdrawal of PF, which was due to come into force from May 1, has been extended.
The release said that the new date from which the new norms will now come into effect from August 1. Once the new rules implemented, a person who is unemployed for more than two months will not be able to withdraw the full amount of their provident fund till one turns 58, the retirement age.
The recent relaxation has been extended to members who have joined an establishment belonging to or under the central or state government, and become a member of contributory provident fund or old age pension.
The decision to amend the rule was made after Labour Minister Bandaru Dattatreya received representations from trade unions.
In February, the government had announced restriction on complete withdrawal from Employees’ Provident Fund (EPF) account, applicable from May 1, 2016. The amended rules do not allow an employee to withdraw the entire amount from his or her PF account till the subscriber attains the age of 58, the age of retirement.
According to the new rules, he can only withdraw the contribution to the PF and interest accrued on it. The employer’s contribution and interest can only be withdrawn after attaining the age of retirement.
The existing rules allow employees to withdraw the full PF balance if he or she is out of employment for continuous 60 days.
