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Budget 2024 Introduces Employment Incentives For Employees And Employers

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July 24, 2024 23 Views

In her seventh budget speech, Finance Minister Nirmala Sitharaman unveiled three new employee-linked incentive schemes as part of the Union Budget for 2024-25. These schemes, integrated into the Prime Minister’s package, will correspond with enrolment in the Employee Provident Fund Organisation. They aim to acknowledge first-time employees and provide assistance to both employers and employees.

Ms. Sitharaman announced Scheme A, which will facilitate EPFO enrollments for first-time entrants into the workforce. The scheme entails a Direct Benefit Transfer of one month’s wages, distributed in three installments, up to Rs. 15,000 per month, for all formal sector employees earning salaries up to Rs. 1 lakh per month. It is projected to benefit 210 lakh youths.

The Minister stated that Scheme B focuses on stimulating job creation in the manufacturing sector. The scheme will offer incentives for increasing employment specifically targeting first-time employees. Both employees and employers will receive incentives related to EPFO contributions during the first four years of employment. This initiative aims to benefit 30 lakh youths entering the job market and their respective employers.

Scheme C involves supporting employers with a focus on stimulating additional employment across all sectors for those earning salaries up to Rs. 1 lakh. Under this employer-focused scheme, the government will reimburse employers up to Rs. 3000 per month for two years towards EPFO contributions for each additional employee. This initiative is anticipated to incentivize the creation of additional employment opportunities for 50 lakh individuals.

In addition to these three schemes, Ms. Sitharaman also unveiled measures aimed at increasing women’s participation in the workforce. These include setting up working women’s hostels and creche facilities in collaboration with industry partners. Further initiatives involve implementing skill development programs specifically for women and enhancing market access for enterprises led by women’s self-help groups (SHGs).