Nearly 3.75 lakh workers with the Employees Provident Fund Organisation (EPFO) account in Bengaluru region have sought COVID-19 advance, underlining the extent of financial and unemployment crisis due to the pandemic.
The Central government introduced a provision for a special withdrawal from the EPF scheme for subscribers to tide over the financial crisis arising out of pay cuts and job loss due to the outbreak of COVID-19.
This special provision entails a withdrawal of 3 months of basic plus DA or 75 per cent of the balance in the EPF account, which ever is less. This is non-returnable and hence there is no burden on the employees to repay the amount with interest as in case of a loan.
There are 35, 41,509 EPF subscribers in Bengaluru zone covering the entire urban conglomerate of whom 3,74,499 employees had raised claims for one-time advance to deal with the financial crisis. This is more than 10 per cent of the work force who are subscribers of EPFO in Bengaluru and the numbers are on the rise.
The figures are as on July 7 and 2,66,212 claims have been settled (as on that date) in respect of Bengaluru zone, according to R.K.Singh, Additional Central Provident Fund Commissioner, zonal office, Bengaluru.
In an email reply to The Hindu he said that as on July 7, the organisation has disbursed in excess of ₹1007.35 crore for Bengaluru zone as COVID-19 advance.
He said in respect of the Hubballi zone, 45,412 claims have been settled as on July 7 and ₹121.84 crore has been disbursed while across Karnataka the EPFO offices have settled 3,11,624 claims and disbursed ₹1129.205 crore (as on July 7, 2020)
Sudhakar Shetty, former president, Federation of Karnataka Chambers of Commerce and Industry, said workers withdrawing their EPF savings is a testimony to the closure of many industries or establishments trimming their work force which has resulted in job loss.
“This is only the tip of the iceberg because a majority of the workforce is out of EPF and engaged in daily, casual or contract labour and lack provident facilities’’, he added.
It is reckoned that bulk of the withdrawal is by employees in the private sector who have taken a pay cut or on furlough and in many cases have been rendered unemployed.
With no sight of the flattening of the curve and intermittent lockdowns being announced by the local authorities, the uncertainty in the economic sector and the cascading impact on jobs is bound to continue till the pandemic subsides, said Mr. Shetty.
