The government would not interfere in the affairs of regulators, finance minister Pranab Mukherjee has said.

He was speaking at a function organised by UTI Mutual Fund’s Investor Education Initiative,  ‘Swatantra’, in Mumbai on Tuesday.

Responding to a question relating to the tussle between the Insurance Regulatory Development Authority (IRDA) and the Securities Exchange Board of India (SEBI), the finance minister said all the disputes would be resolved by a committee headed by him and comprising three members from the government and the regulators in dispute.

Mukherjee said the government was working towards containing the fiscal deficit, which had zoomed to 6.8 percent in the wake of fiscal expansion due to the stimulus package to fight the economic slowdown and  the government’s aim was to achieve higher economic growth on a sustained basis so as to reduce poverty and remove backwardness.

“It is not possible to sustain fiscal profligacy for long. Our objective is to ensure that we can come back to the higher growth not for one or two years but on a sustainable basis for 7-10 years, till we come out of poverty and backwardness,”  he said.

Talking about the government's various welfare schemes, the finance minister added , “The entitlements for people should be backed by an Act of parliament, so that it does not remain a mere wish.” He added that all these objectives were backed by financial allocations in the budget.

He emphasised on the need to provide an institutional structure for savings. Noting that out of a saving rate of 34 percent, nearly 23 percent was contributed by the household savings, with the rest being provided by the private sector, he advocated the role of no-frills accounts, use of mobile vans and business correspondent aimed at financial inclusion. Pointing out that only 37,000 banks branches existed in nearly 6,00,000 villages he said that technology needed to be used to reach out to the rural population of the country.

Referring to the UTI Retirement Benefit Pension Fund, Mukherjee said, “Type of social security, which is available in developed countries, is not available here; so we will have to provide institutional structure for saving.

"Effective mobilisation of savings and their seamless channelisation into investment holds the key in sustaining and accelerating growth. Considering the size, diversities and the population of our country, savings at different levels, irrespective of whether they big-sized or small, are equally important,” the finance minister said. 

UTI Mutual Fund has entered into a tripartite agreement with Bharat Petroleum Corporation Ltd (BPCL) and Corporation Bank for a micro pension initiative through UTI Retirement Benefit Pension Fund to the Short Distance Commercial Vehicles (SDCV) Community Members of BPCL Dealers Network.

Members of the SDCV associated with BPCL and Corporation Bank will contribute an amount as low as Rs 200 every month towards UTI Retirement Benefit Pension Fund. Three UTI Knowledge Caravans would travel throughout the country covering over 300 cities in 100 days through 100 investor meets. The education initiative will be conducted in 10 languages. This initiative aims at providing social security cover for the low income group during their old age.