Thiru. A. Raja launched National Micro Insurance Drive for Rural PLI in Tamil Nadu

The Union Minister of Communications & I.T. Thiru. A. Raja launched the National Micro Insurance Drive for Rural Postal Life Insurance (PLI) at Sholur Mattam, Coimbatore, Tamil Nadu today.

The Minister informed in his speech that Postal Life Insurance is being provided by the Department of Posts since as far back as 1884. Started as a Welfare Scheme for Postal employees alone, Postal Life Insurance has been extended to cover Central and State Government Employees, personnel of Defence forces and Paramilitary and Employees of Public Sector Undertakings and Banks. Rural PLI was introduced by Department of Posts in 1995 with a specific mandate to cover people living in rural areas with emphasis on weaker section in general and women in particular. Till March, 2009, there were around 4 million PLI policies and around 7.8 million Rural PLI policies.

In keeping with its mandate to cover weaker sections of the society in rural areas with special focus on women, the Department of Posts launched the Proof of Concept for Micro Insurance Drive focussing on providing insurance cover to the weaker sections in rural areas. The existing policies of Rural Postal Life Insurance with a Sum Assured of Rs.10,000/- to Rs.25,000/- were propagated in this scheme. In a short span of about a month, more than 1.3 million rural lives have been covered under this scheme.

The Minister informed that the Rural Postal Life Insurance policies are being marketed now not only by the Postal staff and Gramin Dak Sewaks but by also engaging Direct Agents, Aanganwadi workers, Self Help Groups and Co-operatives to facilitate people to get themselves covered under Rural Postal Life Insurance. He also distributed policy documents to Insurants and Licences to Direct Agents on this occasion.

The Minister lauded the Department of Posts with special mention of Postal Circles of Andhra Pradesh, Tamil Nadu, Maharashtra and Uttar Pradesh for their commendable performance in the Proof of Concept for Micro Insurance and hoped that more and more people living in rural areas would be able to get the benefit of insurance cover under this scheme.

The function started with a welcome address by Thiru. S.K. Sinha, Chief General Manager, Postal Life Insurance. Thiru Uday Balakrishnan, Member, Postal Life Insurance delivered the Key Note address. In his address, he outlined the plans of the Department for expansion of Postal and Rural Postal Life Insurance aimed at providing insurance cover to about 100 million people by 2010. He also informed about the steps being taken by way of Technology upgradation for speedy issue of documents and settlement of claims.

Meant to be an awareness drive for Rural Micro Insurance, the function was well attended by target audience comprising among others, large number of Aanganwadi workers and rural farmers. Thiru K. Ramachandran, Minister for Khadi, Government of Tamil Nadu, Thiru A. Soundarapandiyan, MLA, Coonor, Smt. S. Gomathi, District Panchayat Chairman & District Planning Chairman, Thiru K.M. Raju, Chairman, Kothagiri Panchayat Union, Thiru S.T. Thamizharasan, President, Denad Panchayat were also present on this occasion.

Retired Central govt employees not getting revised pension

Resentment is prevailing among the retired railway employees as they are not getting the revised pension as per the recommendations of Sixth Pay Commission, asserted SK Singh, president of United Forum of Pensioners Association while addressing a meeting on Saturday.

He also said that retired employees of many Central government departments are not getting the revised pension due to the callous attitude of the authorities concerned.

He said that though the retired employees have been given the revised pension payment order (PPO) but the pensions have not been revised. The railway authorities have given assurance that all the works relating to the revision of pension would be completed by August but two months have passed and nothing has been done in this regard.

Another leader of the association Mobin Khan said that some of the retired employees have fixed the date of the marriage of their daughters, hoping that revised pension would come in handy. The retired employees have been forced to grapple with financial problems.

RBS Yadav, joint secretary of BSNL retired employees association asserted that resentment is brewing among the BSNL employees as they have not been paid industrial dearness allowance (IDA). Jordan H, district secretary of of the organisation said that the demand for merger of 50 per cent dearness allowance with the basic salary has not been implemented for the persons retired between October 2000 to December 2006.

KC Gupta, general secretary of United Forum of Pensioners Association said that the retired employees are united to fight for their problems. He informed that Pensioners Day would be observed on December 17 and urged the members to participate in the programme.
Source:Times of India

EPFO proposes salary cap rise to Rs 10,000

The Employee Provident Fund Organisation (EPFO) has sent a proposal to the labour ministry to increase the salary limit for paying employee provident fund (EPF) to Rs 10,000 from the current Rs 6,500.

It has also proposed covering companies with a minimum of 10 employees under the Employee Provident Fund and Miscellaneous Provisions Act (EPF & MP Act), 1952, against the present norm of a minimum of 20 employees.

A source close to the development said: “The current norms in EPF & MP Act, 1952, results in millions of workers being left out of the EPFO regulations. Therefore, we have proposed to the government to raise the salary cap and to lower the limit on the worker count in an establishment to be covered by EPFO.”

WIDER UMBRELLA

* Current norms in EPF & MP Act, 1952, results in millions of workers being left out of the EPFO regulations

* The organised labour sector comprises 300 million workers, of which only 40 million are covered under EPFO regulations

* If the proposal is approved by Parliament, the EPFO is likely to cover 50% of the organised labour market

* At present, employers have to contribute a minimum of 12 per cent towards EPF on less than or up to Rs 6,500 (basic + dearness allowance)

* This move will especially help contractual workers. They are the biggest concerns because they are often illiterate

The organised labour sector comprises 300 million workers, of which only 40 million are covered under EPFO regulations. Sources said if the proposal were approved by Parliament, the EPFO was likely to cover 150 million workers in the organised sector, which would be 50 per cent of the organised labour market. The proposal is awaiting the ministry’s approval.

Manish Sabharwal, co-founder and chairman, TeamLease Services, however, said a chunk of these 300 million workers are state- and central-government employees. “The EPFO should first concentrate on covering the private and public sectors in totality before expanding its base any further.” He felt that matters would become more complicated for the organisation if the base were expanded.

At present, employers have to contribute a minimum of 12 per cent towards EPF on less than or up to Rs 6,500 (basic + dearness allowance).

This move will especially help contractual workers. Many smaller firms, which work as contractors to bigger firms, are not obliged to honour the EPF Act. “But in the case of contractual workers, their supervisor pays a lump sum without segregation, due to which their basic-plus-DA earning exceeds the limit of Rs 6,500, so that they need not be registered under the Act,” said the source.

The source added that contractual workers were the biggest concerns because they were often illiterate. Since their employers paid them more than the government prescribed cap, the EPFO could not penalise them. If the government approved the EPFO proposals, these people stood to benefit.

The change in the limit, if approved, could be an important move because of rising salaries over the years. But smaller industries, like the beedi industry, which pay a lower rate of 10 per cent, because of lower turnover, would see a higher outgo if this regulation is implemented.
Source:Business Standard

Govt staff pension funds to hike equity investments by this fiscal

Pension funds managing the New Pension Scheme (NPS) for Government employees will conform to new investment guidelines by the end of this fiscal, said fund managers.

The Pension Fund Regulatory and Development Authority (PFRDA) has issued the new investment guidelines last week, allowing higher investment in equities to fund managers.

Pension funds managing the NPS for Government employees will be able to invest up to 15 per cent of their corpus in equities. The earlier limit was 5 per cent.

The NPS for Central Government employees has a corpus of around Rs 3,000 crore. Of this, around Rs 1,600 crore is managed by SBI Pension Fund, and the remaining Rs 1,400 crore by UTI Retirement Solutions and LIC Pension Fund.

Though the change in the investment pattern was announced some time ago, the communication came only now, said an official with a pension fund house. “Earlier, even though we wanted to invest in stocks of companies based on our assessment of risk and return, we were hindered by the regulation,” the official said.

Flexibility

The investment pattern was relaxed to give more flexibility to pension fund managers. Under the NPS for the unorganised sector where the investors get the option of the investment pattern, majority of the investors have opted for 50 per cent equity.

Earlier guidelines for NPS for government employees mandated that pension fund managers invest at least 25 per cent of the funds in Government securities, 15 per cent in State development loans and 25 per cent in bonds issued by public sector undertakings (PSUs) and public financial institutions (PFIs).

However, investment in equities was capped at 5 per cent and investment in bonds issued by private companies was capped at 10 per cent.

According to the new guidelines, investments in Government securities and State development loans have been put under one bracket and capped at 55 per cent. A limit of 40 per cent has been imposed on investment in bonds issued by PSUs, PFIs and corporates.

Fund managers can also invest in money market instruments such as Treasury bills, commercial papers and certificate of deposits subject to a cap of 5 per cent.

Earlier, pension fund managers could invest only in stocks of companies whose bond issuances have been rated by credit rating agencies. This ruled out stocks of companies which do not raise debt.

Derivative rule

Now, fund managers can invest in stocks of companies listed on the BSE and NSE provided they are present in the derivative segment.

Pension fund managers will also be able to churn their portfolio some more with relaxation in tradeable limits. Earlier, 10 per cent of the Government security portfolio and the whole of the equity portfolio were tradeable. Now, fund managers can trade subject to a cap that the trading volume is twice the holding.
Source:Hindu Business Line