Economy

EPFO blocks accounts of 9 lakh employees after govt finds job incentive fraud, says report

Updated : January 30, 2020 11:54 AM IST

The EPFO has blocked the provident fund (PF) accounts of about 9 lakh beneficiaries who were found ineligible in first place for PMRPY.

The EPFO has, so far, also recovered Rs 222 crore from the employers concerned.

Under PMRPY, government pays the full employer's contribution towards EPF and EPS for the new employment.

The government has unearthed 80,000 companies that have been tricking the financial system of the country by taking incentives worth Rs 300 crore from the central for Pradhan Mantri Rojgar Protsahan Yojana (PMRPY), according to a Business Standard report.

In wake of this, the Employees’ Provident Fund Organisation (EPFO) has blocked the provident fund (PF) accounts of about 9 lakh beneficiaries who were found ineligible in first place for this scheme, the report added.

The EPFO has, so far, also recovered Rs 222 crore from the employers concerned. The employee accounts, which have been blocked, were already a part of the formal economy, even before the scheme was brought in, the Business Standard report stated.

PMRPY, introduced in 2016, is a government’s flagship job formalisation scheme. EPFO payroll database is used by the government to show job creation in the formal sector.

Under this scheme, government pays the full employer's contribution towards Employees' Provident Fund (EPF) and Employee Pension Scheme (EPS) for the new employment.

This scheme has a dual benefit, where, on the one hand, the employer is incentivised for increasing the employment base of workers in the establishment, and on the other hand, a large number of workers can find jobs in such establishments, according to government report.

A direct benefit is that these workers have access to social security benefits of the organised sector.

The scheme is implemented by the Ministry of Labour and Employment through the EPFO.

EPFO blocks accounts of 9 lakh employees after govt finds job incentive fraud, says report

You May Also Like

Coronavirus: Coal India subsidiaries set up 1,509 isolation beds in 8 states

Coronavirus mayhem: FPIs pull out record Rs 1.1 lakh crore in March

Coronavirus update: India cases doubling every 4.1 days

Trending on CNBC-TV18

recommended for you