NEW DELHI: Officers of the Employees’ Provident Fund Organisation (EPFO) — the world’s largest social security organisation with over 277 million accounts and a corpus of around ₹20 lakh crore — alleged that they are under “extreme duress” after EPFO reverted to the manual updation of annual accounts even as it holds them responsible for any delay in claim settlement beyond stipulated 20 days. The background to the issue is the organisation’s IT system, which employees believe is obsolete.
Weeks before the proposed grand celebrations of EPFO’s 71st Foundation Day on November 1, Employees’ Provident Fund Officers’ Association (EPFOA), in a letter to the government said while claims rejection ratio is an “important barometer” to analyse performance , this metric “cannot be brought down without software intervention” as organisation’s current software is working on “GIGO” principle. In information technology (IT) “garbage in, garbage out” (GIGO) means a flawed input will result in a faulty output.
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“While we welcome the scrutiny of claim rejection ratios, the monitoring standard should exclude inadmissible claims, which are bound to be rejected. The statute itself states that claims complete in all respects submitted along with the requisite documents shall be settled and the benefit amount paid to the beneficiary within 20 days. Monitoring of incomplete claims as a performance metric is against the provisions of schemes, yet officers are being routinely, mechanically, and unfairly targeted for rejection of invalid claims,” the letter, reviewed by HT, said.
EPFO has been suffering from serious software infrastructure-related issues for past few years, and these have become worse in the past two-three years, the association said. “Our archaic application software which is the backbone for claims settlement process is now so unresponsive that it takes a herculean effort to complete routine tasks,” it wrote. Confirming the letter, EPFOA’s secretary general Saurabh Swami said the revised performance system now stipulates settlement of subscribers’ claims within 20 days of filing the application, failing which officers are held accountable for payment of additional interest. Earlier, a 30-day timeline was stipulated.
The labour ministry and the Central Provident Fund Commissioner (CPFC) did not respond to an email query .
In another letter dated October 3, addressed to CPFC, EPFOA said, “Our current application software on which bulk of our operations are run is of 2008 vintage.” It listed some of the standard software under use —Windows Vista (2008), IOS 3 (now IOS 17 is available), and Android version 1 (now version 14 is available). “We understand that C-DAC [Centre for Development of Advanced Computing] had, sometime in the year 2019 given a comprehensive proposal for system revamp. EPFO paid consultancy charges for procuring the said recommendation. Inexplicably nothing further has been heard of that proposal.”
The letter pointed out that mammoth tasks of annual accounting are being done manually. “Latest in this process of sub-optimal solutions is the process of annual account updation for the year 2022-23, which till last year was updated through system. Now it requires manual certification. We understand that it signifies almost complete collapse of system in EPFO, thereby forcing a revert to manual updation,” it said.
“EPFO is managing social security money of millions of subscribers and any systemic failure could be disastrous,” a senior EPFO official said requesting anonymity.