Keeping its focus on job creation, the government is hopeful of rolling out the employment linked incentive schemes that were announced in the Union Budget 2024-25 by the end of the current year 2024.
In an interaction with BT, Labour Secretary Sumita Dawra said that the government is working on a number of operational aspects. There are also several procedural issues and approvals should be in place by the end of the year.
“We are already working on the schemes and we should be ready with the draft in another few weeks. Then, there is a process to be followed. There has to be inter ministerial consultation, then it will go to Expenditure Finance Committee and then it will go to the Union Cabinet for approval. So we do hope that we will be able to deal with all these procedural aspects by the end of this year,” she said.
With an eye on formal sector job creation, the Union Budget 2024-25 has announced three schemes for Employment Linked Incentive as part of the Prime Minister’s Package. Finance minister Nirmala Sitharaman had said that these would be based on enrolment in the EPFO, and focus on recognition of first-time employees, and support to employees and employers.
These include a scheme that will target first-time employees in the formal sector registered with EPFO and will offer a one month wage up to Rs 15,000 in three instalments, another scheme that will incentivise additional employment in the manufacturing sector, especially for first time job seekers, through a contribution to the EPFO and a third employer-focussed scheme that will cover additional employment in all sectors.
Noting that the Budget has given a lot of details on the schemes, the Labour Secretary highlighted that these will ride on the EPFO. “The strength is that EPFO is already doing this kind of work and so it aligns with its existing work,” she said.
However, there are a few elements on which the ministry is currently working. This includes the payments through Direct Benefit Transfer for Scheme A, which would require a tweak in the IT systems. “We are working out the requirements of software and hardware. In any case, the EPFO is already in the process of upgrading its hardware and software,” she said.
The Budget has allocated Rs 10,000 crore this fiscal for these three schemes. Along with other schemes for skilling and on the job training, the Finance Minister had said that these would together create skilling and other opportunities for 4.1 crore youth over a five-year period.