Low cost housing scheme for EPFO subscribers soon

Good news for EPFO subscribers. Government is working on a scheme to provide low-cost housing for retirement fund body EPFO’s over five crore subscribers, Parliament was informed today.

“Government is exploring the possibility for providing a suitable low-cost housing scheme for subscribers of Employees’ Pension Fund. It is in preliminary discussion stage,” Labour Minister Bandaru Dattatreya said in a written reply to Lok Sabha.

The minister was replying to a question whether the government or the EPFO has introduced/proposes to introduce a scheme to allow its subscribers to pledge their future PF contribution to buy low-cost houses.

Last year, the proposal was also listed on the agenda of the meeting of the Employees’ Provident Fund Organisation’s EPFO trustees meeting on September 16.

The proposal was to allow its subscribers to pledge their future PF contribution to buy low-cost houses. A report of the expert committee on housing facility for the subscribers was also presented to the trustees for their perusal.

The committee has unanimously recommended a scheme to facilitate subscribers to buy houses where they will get an advance from their PF accumulation and will be allowed to pledge their future PF contribution as EMI (Equated Monthly Installment) payment.

Under the proposed scheme, there will be tripartite agreement with member, bank/housing agency and EPFO for pledging future PF contributions as EMI payment.

The panel had suggested that the subscribers will purchase a dwelling unit with loans from bank or housing finance companies and hypothecation of property in favour of the latter.

It was suggested the benefits under the scheme of Ministry of Housing and Urban Poverty Alleviation can also be extended to the beneficiaries of the scheme.

However, the panel had suggested this scheme for low income formal workers who are EPFO subscribers and could not buy a house during their entire service period.

(Image credits: indiatimes)