EPFO Faces Historic Default Surge, Marking A 69.3% Increase; Details Here

Defaults from private sector unexempted establishments totalled Rs 13,734.85 crore, public sector defaults amounted to Rs 2,252.27 crore, and defaults from cooperatives stood at Rs 362.58 crore

Of the total defaults of Rs 16,349.7 crore from unexempted establishments, Rs 9,474 crore, or 57.9 per cent, were categorised as not immediately realisable (NIR)

Source : ABPLIVE AI

Defaults under the Employees' Provident Fund Organisation (EPFO) reached a record high of Rs 25,820.88 crore at the end of 2023-24, marking a 69.3 per cent increase from Rs 15,254.06 crore the previous year, according to official data.

The latest data reveals a rise in defaults by exempted establishments. Of the Rs 5,318.42 crore in arrears owed by these establishments, only Rs 847.77 crore has been recovered, leaving an outstanding balance of Rs 4,470.65 crore, according to the EPFO annual report accessed by The Economic Times.

This represents a 243.7 per cent increase from the Rs 1,300.88 crore in arrears owed by exempted establishments in 2022-23.

Telangana led the list of states with the highest arrears from exempted establishments of Rs 3,505.84 crore, followed by Delhi with Rs 213.52 crore, West Bengal and Sikkim with Rs 145.26 crore, Jharkhand with Rs 135.66 crore, and Rajasthan with Rs 115.85 crore. Together, these states account for 92.07 per cent of the total arrears.

Of the total defaults of Rs 16,349.7 crore from unexempted establishments, Rs 9,474 crore, or 57.9 per cent, were categorised as not immediately realisable (NIR). This is likely due to the amounts being under dispute in courts or tribunals or because the establishments were in liquidation, on instalment plans, or involved in rehabilitation schemes sanctioned by the Board for Industrial and Financial Reconstruction.

Defaults from private sector unexempted establishments totalled Rs 13,734.85 crore, public sector defaults amounted to Rs 2,252.27 crore, and defaults from cooperatives stood at Rs 362.58 crore.

In response to the rise in defaults from exempted establishments, the EPFO has directed its regional offices to seek assistance from state governments in recovering arrears. The instructions include publicly displaying the names of the top 10 defaulters in the office and on the EPFO website, attaching movable and immovable properties of defaulters with state police assistance, and having jails designated as civil prisons by the relevant authorities to expedite the recovery process.