Reliance Capital Asset Management Company (RCAM) and ICICI Securities Primary Dealership have been selected to manage Rs 60,000 crore provident fund corpus of coal industry workers, a government official has said. The decision was taken by the board of trustees (BOT) of the Coal Mines Provident Fund Organisation (CMPFO) in its meeting, chaired by Coal Secretary Anil Swarup, who is the Chairman of BOT, in Kolkata on Thursday.
“Out of the four -- SBI, UTI, RCAM and ICICI Securities, RCAM and ICICI have been selected for management of about Rs 60,000 crore provident fund corpus of the coal industry workers,” the official said. Both RCAM and ICICI have emerged as the lowest bidders in the financial bids.
Earlier the four managers had qualified for the financial bid after clearing the technical round. A member of the trustees said there are about 4.5 lakh members of the CMPFO and the corpus fund would further increase from about Rs 60,000 crore as about 62,000 contract coal workers have been added to the fold.
The BOT, he said, also took a decision to transfer the pension amount to the accounts of the widows of the pensioners on submission of death certificates. A parliamentary panel has expressed its reservations about CMPFO not parking the funds in “an appropriate manner” and even suggested referring the matter to a central investigating agency. An autonomous organisation governed by the Board of Trustees, CMPFO functions under the Ministry of Coal and administers the Coal Mines Provident Fund and Miscellaneous Provision Act, 1948, and various schemes framed under that.
Meanwhile, the Pension Fund Regulatory and Development Authority (PFRDA) on Friday said tax treatment on the National Pension Scheme (NPS) is a dampener and the regulator will continue to fight for a level-playing field.
PFRDA has been batting for EEE (Exempt Exempt Exempt) status for NPS. Under the current rules, the NPS corpus is taxable at the time of withdrawal. “Tax treatment is an issue that has affected NPS. The taxation is associated with the scheme as it is taxed at maturity. All other competing products, including EPF, Public Provident Fund, are EEE while NPS is EET (Exempt Exempt Taxed),” PFRDA <g data-gr-id="71">wholetime</g> member B S Bhandari said.
He was speaking on the sidelines of a seminar organised by ICAI (east) on insurance and pension. Bhandari said, “Whenever we meet government officials, we always emphasise on the need to give NPS a level-playing field. We have been asking for an EEE status. We will again do that in the forthcoming Budget.”
In all, there are 92 lakh NPS subscribers with asset under management of Rs 86,500 crore. Bhandari sees a huge scope for NPS as “it’s the best product” if taxation part is set aside. The total expense ratio is 3 per cent for the entire vesting period of the scheme and 0.45 per cent annual recurring charges, including AMC fees. “In terms of cost to a subscriber, NPS charges are among the least globally,” Bhandari said.