PPF deposits continue to be safe and secure: Government

NEW DELHI: The Budget 2018-19 has a proposal that you need to know about -- the functioning of the Public Provident Fund (PPF). According to the Finance Bill2018-19, a provision has been made to repeal the PPF Act, 1968.

The proposed change in the budget has raised fears of losing benefits under the PPF scheme among subscribers and beneficiaries. This prompted Economic Affairs Secretary SC Garg to issue a clarification on the matter.

The economic affairs secretary took to Twitter and said: "Public Provident Fund (PPF) Deposits enjoy protection from being attached. All existing protections have been saved while consolidating PPF Act under proposed Government Savings Promotion Act. Existing and new PPF deposits would continue to have this protection."

In the Finance Bill, a provision has been made to repeal the Public Provident Fund Act, 1968. As a result, all small savings schemes including PPF will now be covered under the Government Savings Banks Act, 1873. The schemes include Post Office Savings Account, National Savings Monthly Income (Account), National Savings Recurring Deposit and Sukanya Samriddhi Account.

The Finance Bill 2018 states that the ongoing structure of the schemes will not be affected if the PPF Act is repealed.

Following is what the bill exactly says:

Anything done or any action taken or purported to have been done or taken, including any rule, notification, order or notice made or issued or any direction given under the repealed enactments shall be deemed to have been done or taken under the corresponding provisions of this (Government Savings Banks Act, 1873 ) Act."

"All deposits made or accounts or certificates held under the repealed enactments shall be deemed to be deposits or holdings in the Savings Scheme made under the corresponding provisions of this (Government Savings Banks Act, 1873) Act."

"The repeal shall not prejudicially affect the interest of depositors who, before the commencement of the Finance Act, 2018, made deposits or were issued certificates or made contribution to any scheme under the repealed enactments."

(With inputs from agencies)