New Delhi: After a peaceful coexistence for just a fortnight, the Left on Thursday took on the government over the reduction in the Employees Provident Fund rate to 8.5 per cent.
The opposition within the UPA is back in business as they termed the decision "shocking" and "anti-people". Also at the receiving end of the anger was Labour Minister Chandrashekhar Rao.
"What authority does the labour minister have to say what he did," Brinda Karat, general secretary, All India Democratic Women?s Association, said.
"The labour minister has breached privilege by announcing this outside the house and can the government not provide a mere Rs 700 crores, when it can forgo Rs 7000 crores by way of reduction of intransaction tax," CPI leader Gurudas Dasgupta said.
However, the bigger question is how will the Employees Provident Fund Organisation (EPFO) meet the 8.5 per cent mark?
Its finances allow it to pay only 8 per cent rate of interest to its subscribers. Another 0.5 per cent interest will mean that the EPFO will have to get an additional Rs 366 crore.
Having drawn on its special reserve fund last year, the EPFO has no other option to look for money.
Nearly 80 per cent of the fund money is invested in the Special Deposit Scheme of the government, which is not a viable investment according to the Left.
The Left trade unions are now accusing the government of using the provident fund as a cheap resource.
The trade unions are also averse to the fund money being invested in other high return options like the share markets.
While the Left threatens to take to the streets once again, the onus of convincing the Left will lie with the Prime Minister Manmohan Singh when the issue comes up for discussion in the Labour Conference on Friday.
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