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In her seventh budget speech, Finance Minister Nirmala Sitharaman announced three new employee-linked incentive schemes in the Union Budget for 2024-25. The three schemes, which are part of the Prime Minister’s package, will align with enrolment in the Employee Provident Fund Organisation and focus on the recognition of first-time employees, as well as support to both employers and employees.
Also Read: Click here for the Union Budget 2024 updates, highlights
Scheme A will support EPFO enrollments for first-timers in the workforce, with a one month wage payout for all formal sectors in three installments, upto Rs. 15,000 per month, with an eligibility limit of a salary of Rs. 1 lakh per month. This Direct Benefit Transfer scheme is expected to benefit 210 lakh youths, Ms. Sitharaman said.
Scheme B pertains to the creation of jobs in manufacturing. The scheme will incentivise additional employment in the sector linked to first time employees. An incentive to employee and employer will be provided with respect to EPFO in first 4 years of employment. This is expected to benefit 30 lakh youth entering employment and their employers, the Minister said.
Scheme C pertains to support to employers. It is to be an employer- focused scheme which will focus on additional employment in all sectors for those earning within a salary of 1 lakh. The government will reimburse employers up to Rs. 3000 per month for two years towards EPFO contribution for each additional employee. This sceme is expected to incentivise additional employment of 50 lakh persons.
Along with these three schemes, Ms. Sitharaman also announced measures to facilitate higher participation of women in the workforce, including establishment of working women’s hostels and creche facilities through partnership with industry. Further steps include women-specific skilling programmes and promotion of market access to women-led SHG enterprises.
Ms. Sitharaman also announced a new centrally sponsored scheme for skilling in collaboration with States and industry. 20 lakh youth will be skilled over a five year period under this scheme, she said. One thousand industrial training institutes are expected this to be upgraded in hub and spoke arrangement, with course content aligned to skill needs of industry.
The model skill loans scheme will also be revised to facilitate loans of upto Rs. 7.5 lakh with a guarantee from a government-promoted fund. This is expected to help 25,000 students a year. Further, youth who have not benefited from any government scheme, will get support for loans upto Rs. 10 lakh for higher education in domestic institutions, the Minister announced.
