Legal Framework for Retirement

THE PROVIDENT FUNDS ACT, 1925   The Provident Funds Act, 1925, is a crucial piece of legislation in Pakistan that governs the establishment and operation of provident funds for the benefit of employees. This act ensures that employees receive financial security and retirement benefits by mandating employers to contribute to provident funds. It plays a pivotal role in promoting long-term savings and financial stability for workers. 27th AUGUST. 1925 An Act to amend and consolidate the law relating to Government and other Provident Funds. WHEREAS it is expedient to amend and consolidate the law relating to Government and other Provident Funds ;   It is hereby enacted as follows : —   Short title extent and commencement. — (l) This Act may be called the Provident Funds Act, 1925. (2) It extends to the whole of Pakistan. (3) It shall come into force on such date as the Federal Government may, by notification in the official Gazette, appoint.   Definitions. In this Act, unless there is anything repugnant in the subject or context, — (a) ” compulsory deposit” means a subscription to, or deposit in, a Provident Fund which, under the rules of the Fund, is not, until the happening of some specified contingency, repayable on demand otherwise than for the purpose of  Payment of Premia in respect of a policy of life insurance or the payment of subscriptions or premia in respect of a family pension fund , and includes any contribution 6   and any interest or increment which has accrued under the rules of the Fund on any such subscrip­tion, deposit or contribution, and also any such subs­cription deposit, contribution, interest or increment remaining to the credit of the subscriber or depositor after the happening of any such contingency ; (b) ” contribution” means any amount credited in a Provident Fund, by any authority administering the Fund , by way of addition to, a subscription to, or deposit or balance ; t the credit of an individual account in,  the Fund ; and ” contributory Provident Fund ” means a Provident Fund the rules of which provide for the crediting of contributions ; (e) ” dependant ” means any of the following relatives of a deceased subscriber to, or a depositor in, a Provident Fund, namely, a wife, husband, parent, child, minor brother, unmarried sister and a deceased sons widow and child, and, where no parent of the subscriber or depositor is alive, a paternal grand-parent; (d)  Government Provident Fund ” means a Provident Fund, other than a Railway Provident Fund, con­stituted by the authority of the Secretary of State, the Federal Government, the Crown Representative or any Provincial Government  for any class or classes of  persons in the service of the State or of persons employed in educational institutions or em­ployed by bodies existing solely for educational purposes, and references in this Act to the Go­vernment shall be construed accordingly ; (e) ” Provident Fund ” means a fund in which subscrip­tions or deposits of any class or classes of employees are received and held on their individual accounts, and includes any contributions and any interest or increment accruing on such subscriptions, deposits or contributions under the rules of the Fund ; (f) ” Railway administration ” means — (i) any company administering a railway or tramway in Pakistan under a Pakistan law, or under contract with the Government, or (ii) the manager of any railway administered by the Federal Government or the manager of any tram­way administered by a Provincial Government; and. (g) ” Railway Provident Fund”  means a  Provident Fund constituted by the authority of a railway ad­ministration for any clash or classes of its employees.   Protection of compulsory deposits. — (1) A compulsory deposit in any Government or Railway Provident Fund shall not in any way be capable of being assigned or charged and shall not be liable to attachment under any decree or order of any Civil, Revenue or Criminal Court in respect of any debt or liability incurred by the subscriber or depositor, and neither the Official Assignee nor any receiver appointed under the Provincial Insolvency Act, 1920, shall be entitled to, or have any claim on, any such compulsory deposit. (2) Any sum standing to the credit of any subscriber to, or depositor in, any such Fund at the, time of his decease and payable under the rules of the Fund to any dependant of the subscriber or depositor, or to such person as may be authorised by law to receive payment on his behalf shall, subject to any deduction authorised by this Act and, save where the dependant is the widow or child of the subscriber or depositor, subject also to the rights of an assignee under an assignment made before the commencement of this Act, vest in the dependant, and shall, subject as aforesaid, be free from any debt or other liability incurred by the deceased or incurred by the dependant before the death of the subscriber or depositor.   Provisions regarding repayments. — (1) When under the rules of any Government or Rail­way Provident Fund the sum landing to the credit of any sub­scriber or depositor, or the balance thereof after the making of any deduction authorised by this Act, his become payable, the officer whose duty it is to make he payment shall pay the sum or balance, as the case may he. to the subscriber or depositor, or, if he is dead, .ball — (a) if the sum or balance, or any part thereof, vests in a dependant. under the provisions of section 3, pay the same to the dependant or to such person as may be authorised by law to receive payment on his behalf; or (b) if the whole sum or balances the case may be, does not exceed five thousand rupees, pay the same, or any part there of, which is not payable under clause (a), to any person nominated to receive it under the rules of the Fund, or, if