GPF for those Recruited After 2004 | Details & Information
The General Provident Fund (GPF) is a scheme that applies to individuals who have been recruited on or after January 1st, 2004. This scheme allows employees to contribute a portion of their salary to a savings account that accrues interest over time. The purpose of the GPF is to provide financial security to employees during their retirement years and to help them meet unforeseen expenses. Through this scheme, employees have a reliable and safe way to save money for their future.
Shiva Gopal Mishra
National Council (Staff Side)
Joint Consultative Machinery
for Central Government Employees
13C, Ferozshah Road, New Delhi – 110001
E-Mail : firstname.lastname@example.org
April 23 , 2019
Government of India
Department of Pension and Pensioners welfare
3rd Floor, Lok Nayak Bhawan.
Khan Market, New Delhi.
Sub : GPF for those who have been recruited on or after 1-1-2004.
Ref : Item No. 5 of the agenda point discussed in the 47th meeting of National Council (JCM) held under the Chairmanship of Cabinet Secretary on 13th April 2019.
You are aware that the Staff side of the National Council JCM is repeatedly demanding for withdrawing the NPS and re introduce the defined Guaranteed pension scheme under the CCS (Pension) Rules 1972 to the employees who have been recruited on or after 1-1-2004. However pending the same the staff side has represented for extending the benefit of GPF for those employees who have been appointed on or before 1-1-2004 and governed under NPS on an optional basis. In the 47th National Council JCM meeting held on 13-4-2019, the Staff side reiterated their demand and requested that the GPF scheme may be extended to the NPS employees who opt for the same as an additional saving benefit. The Cabinet Secretary desired that the demand of the Staff Side may be considered favorably. Your good self has also assured that the demand of the Staff side would be considered and decision taken at the earliest.
In view of the above we submit the following justification for extending the GPF benefit on optional basis to the employees who are governed under the NPS scheme.
The advantage of GPF to the employees is as follows:
(1) The interest rate for GPF accumulation is 8% as on date.
(2) Advances from GPF is permissible for the following purposes.
(i) Illness of self, family members or dependents.
(ii) Education of family members or dependent of the subscriber. Education will include primary, secondary and higher education, covering all streams and educational institutions.
(iii) Obligatory expenses, viz. betrothal, marriage, funerals or other ceremonies.
(iv) Cost of legal proceedings
(v) Cost of defence
(vi) Purchase of consumer durable
(vii) Pilgrimage and visiting places of eminence. This will include any travel and tourism related activities.
(3) Apart from the advances as mentioned above GPF subscribers are entitled for withdrawals from GPF for the following purposes.
(i) Education : This will include primary, secondary and higher education covering all streams and institutions.
(ii) Obligatory expenses, viz. betrothal, marriage, funerals, or other ceremonies of self or family members and dependants.
(iii) Illness of self, family members or dependants.
(iv) Purchase of consumer durables.
(v) Housing including building or acquiring a suitable house or a ready built flat for his residence.
(vi) Repayment of outstanding housing loan.
(vii) Purchase of house site for building a house.
(viii) Constructing a house on a site acquired.
(ix) Reconstructing or making additions on a house already acquired.
(x) Renovating, additions or alterations of ancestral house.
(xi) Purchase of motor car/ motor cycle/ scooter etc. or repayment of loan already taken for the purpose.
(xii) Extensive repairs / overhauling of motor car.
(xiii) Making deposit to book a motor car / motor cycle / scooter, moped, etc.
Apart from the above tax deduction under section 80C is also available. Annual statements will be issued on the 1st of April every year.
From the above it is amply clear that the GPF is more advantages to the employees than the Tier-II scheme of NPS. Therefore as stated by the staff side in the National Council JCM meeting held on 13-4-2019 it is once again reiterated that the GPF scheme may be extended to the willing NPS employees who opt for the same. Necessary orders in this regard may please be issued at the earliest. A copy of your instructions may please be endorsed to this Office.
(Shiva Gopal Mishra)
What is the current interest rate for GPF accumulation?
The interest rate for GPF accumulation is 8% as on date.
Can advances be taken from GPF?
Yes, advances from GPF are permissible for various purposes.