(a) whether any scheme of incentives has been worked out to
counter the disincentives raised by lowering of interest on
Savings Accounts and General Provident Fund, in respect of
savings of workers and the common man;
(b) if so, the details thereof and if not, the reasons therefor; and
(c) the over all percentage loss of interest to an average worker
caused by such disincentives during the last three years ?
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI BALASAHEB VIKHE PATIL)
(a) and (b) No, Sir. The rates of interest on small savings
schemes and General Provident Fund have been marginally reduced
so as to align them with the overall interest rate structure in
the country. The existing incentives including risk free returns,
tax concessions and easy accessibiliy continue to boost investor
confidence with the result that deposits in small savings schemes
have increased even after the rates of interest have been reduced.
(c) The lowering of interest rates on GPF and Small Savings must be
weighed against the larger benefits that will accrue due to the
expected growth in the economy.