Opposition Slams New EPFO Rules, Calls Them ‘Punishment’ for Salaried Class
Critics say new rules delay access to provident fund, causing hardship to unemployed workers amid rising inflation and joblessness.
New Delhi: The central government’s recent changes to Employees’ Provident Fund Organisation (EPFO) withdrawal rules have drawn sharp criticism from opposition parties, who say the move unfairly targets the salaried class and restricts access to their own hard-earned money.
As per the new rules, employees who lose their jobs will now have to wait 12 months to withdraw their full Provident Fund (PF) amount, and 36 months to access the pension portion. Previously, this waiting period was only two months.
Additionally, the government has made it mandatory for at least 25% of the total balance to remain in the employee’s account at all times effectively locking that portion of their savings until retirement.
Opposition’s Reaction:
Congress MP Manickam Tagore called the move “cruel and inhumane,” adding,
“This is not reform, it’s robbery. The government waives billions for corporates, but denies workers access to their own savings when they need it most.”
Tagore said workers often need immediate access to funds after job loss to manage daily expenses, and delaying withdrawal for a year is “completely unjust.”
TMC MP Saket Gokhale also condemned the decision, calling it “shocking and absurd.”
“This is nothing but daylight robbery of salaried employees’ money. First, the wait is extended from two months to a year, and now 25% of the funds are permanently locked. How is an unemployed person supposed to pay bills and EMIs?”
Congress spokesperson Shama Mohammed accused the government of “looting workers under the guise of simplicity.”
“Holding back 25% of a person’s savings indefinitely, and making them wait a full year for withdrawal is draconian. The government must immediately reverse this decision.”
Government’s Defence:
A senior official from the Ministry of Labour and Employment explained that the changes aim to ensure long-term social security for employees in the formal sector.
The official said many workers withdraw their PF savings after just two months of unemployment, which disqualifies them from receiving pension benefits later when they find a new job.
“By maintaining a balance in the account, members will benefit from higher interest rates and compound growth, ultimately helping them accumulate a larger retirement corpus,” the official added.
Other Rule Changes Announced:
- The number of withdrawal categories has been reduced from 13 to just 3:
- Basic needs
- Housing
- Special circumstances
- For special circumstances, members will no longer need to provide a reason for withdrawal.
- Partial withdrawals for specific purposes have been expanded:
- Education: up to 10 times (previously 3 times)
- Marriage: up to 5 times (previously 3 times)
Experts React:
While some analysts acknowledge that the changes are designed to promote savings and ensure pension stability, many say the rules will harm workers who face sudden unemployment and need immediate financial support.
The announcement comes at a time when inflation and joblessness are both on the rise in India, making it even more difficult for the average salaried worker to manage without access to their own savings.
