Pension Fund Mess

Every salaried Indian citizen contributes 24% of his basic salary (12% employee and 12% employer contribution) into the organization. For a country with a GDP of $1 trillion and an active workforce of 600 million souls that is a lot of responsibility. I always get the feeling that the thela-wala (street vendor) has more advanced book-keeping system than the EPFO (employee pension fund organization). Don’t believe me?

The street vendor can recite his entire Cash-Flow statement, Balance sheet (how much is in his inventory, how much debt he has taken, how much credit he has given, how much money he has put in etc.) and his P&L. However EPFO takes a year to do these calculations and ever after those, they make a royal mess.

Today I got a mail from my payroll department with my EPFO balance. However that came with this Disclaimer:

“The calculation excludes the interest component & this mail is for your information only.”

Considering that interest rate in India is 8.5% and I have been working since 2004, this information was actually misleading and worthless.

Hence I logged into the EPFO website. The site keeps on crashing, it has no way to get an online statement, paper statement or even call up someone who would know this information. Finally through miracle of god I was able to access: http://www.epfindia.com/membbal.html . After fiddling around for 10 minutes, I was able to get this information:

“Your EPF Balance as on 03/03/12 is XXX (Accounts updated up to 31/03/2011)”

What is that takes them one year to update the records? Last year they discovered a huge pile of unaccounted cash-pile (which they disbursed as a bonus/extra interest payout) which they later on discovered was because the interest rates were not accrued properly. Such Goof-ups for an organization that manages savings for over 100 millions souls is totally reckless and unacceptable.