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Union Cabinet approves extension of PF contributions till Aug and free foodgrain till Nov

New Delhi: The Union Cabinet on Wednesday approved the proposal to extend the scheme for payment of the employer and employee's PF contribution for three months until August.

It also approved extending the scheme for distribution of free food grains to the country's poorest until the end of November to help them cope with the economic pain of the coronavirus-induced lockdown.

Finance Minister Nirmala Sitharaman had announced the extension of the benefit in May this year.

"Cabinet has approved the extension of the scheme where government pays contributions of employee and employers till August," Union Minister Prakash Javadekar told reporters after the Cabinet meeting on Wednesday.

Sitharaman in May had announced the extension of the scheme under the Pradhan Mantri Garib Kalyan Yojana for three months till August, where the government would contribute entire 24 per cent of PF contributions till August, giving relief to 3.67 lakh employers and 72.22 lakh employees.

Javadekar said that the decision has been taken to facilitate more take-home salary for employees and give relief to employers in payment of PF dues.

The government had imposed lockdown on March 25 to fight the deadly COVID-19.

Under the Pradhan Mantri Garib Kalyan Package, the payment of 12 per cent of employer and 12 per cent employee contribution was made into EPF accounts.

The benefit was provided earlier for salary months of March, April and May 2020. This support is extended by another three months to salary months of June, July and August 2020.

The extension of the benefit will provide a liquidity relief to 3.67 lakh establishments.

The government is of the view that businesses need support to ramp up production over the next quarter (July-September).

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