Open letter to Minister for Labour & Employment against the media report that thousands of crore rupees of EPF funds invested in tradable bonds in IL & FS.

Dear Sir,

I seek to draw your pointed attention to the media report that thousands of crore rupees of EPF funds invested in tradable bonds in IL&FS group have been put on risk of being lost as the group companies are facing near bankruptcy situation and presently in the midst of resolution procedures in National Company Law Tribunal (NCLT) under section 53 of the Insolvency Bankruptcy  Code Act (IBC).

As per the report, over 50 EPF funds of various companies, both in PSUs and number of private sector giants involving the post retirement savings and benefits under EPF of over 15 lakh employees have been put in such risk following their exposure to IL&FS. And since the tradable bonds of IL&FS in which the EPF funds of such huge dimension has been invested are being considered as unsecured debt of IL&FS and thereby losing priority vis-à-vis debts from the banks and financial institution in the resolution process under IBC, the risk of loss has become more imminent.

Kindly recall, the workers’ representatives in Central Board of Trustees (CBT) of EPFO have been consistently opposing the investment of EPF funds in any speculative tradable instruments, but the Govt of India bulldozed the unanimous opposition of the workers representatives and channelized a part of EPF funds for investment in speculative instruments. Now, you will see the results as the life-times savings in EPF of the concerned workers and employees of the affected establishments, it being pushed to the possibility of imminent loss of even the invested amount itself, not to speak of interests.

I strongly feel, the Govt must draw the appropriate lesson from such happening and review the decision imposed by the Finance Ministry to invest EPF fund up to 15% in speculative trade instruments of all kinds.  Govt must also take the responsibility of protecting the EPF savings of the employees/establishments which have already been pushed to risk of loss owing to their exposure with IL&FS  group along with interest since concerned workers should not be subjected to loss of their savings for no fault of theirs but for wrong unilateral decision of the Govt.  

I would also urge upon you to send us the details of investment exposure of EPF funds with IL&FS bonds both for the funds under CPFC and also  for the exempted establishments entity-wise  so that actual situation can be ascertained and dealt in a transparent manner in the interest of fairness, transparency and propriety. 

Awaiting expeditious response,

With regards
Yours sincerely,
( Tapan Sen )
General Secretary

 

To

Shri Santosh Gangware
Minister of Labour & Employment
Govt of India
Sharam Shakti Bhawan
Rafi Marg, New Delhi

Read 967 times