EPFO Scheme: The Indian Finance Minister, Nirmala Sitharaman, on 23rd July 2024, presented the Union Budget for the fiscal year 2024-25. The budget included many unpredictable changes, amendments, and the introduction of some new schemes.
The government has provided major benefits to employees and employers by introducing three big schemes related to the employee’s provident fund. The government is also set to make the EPFO (Employee Provident Fund Organization) desirable and welcoming for freshers through a budget of 1.07 lakh crores.
Read the following article to learn about the three schemes and also how they will benefit the employees. We’ll also provide you with deeper insights into the schemes, and explain their major features as well. Keep reading for a better understanding.
Table of Contents
Scheme A: One Month’s Wage For Freshers
The “One Month’s Wage For Freshers” scheme is a groundbreaking initiative introduced in the 2024 budget to support new entrants in the workforce. This scheme aims to provide financial assistance to freshers during their initial month of employment, helping them transition smoothly into their new roles.
This Employee PF scheme has a budget of around Rs. 23,000 crores providing Rs.15,000 as the initial salary to the freshers. This amount will be directly transferred to the bank accounts benefiting around 2.1 crore new employees.
| Name | Details |
|---|---|
| Scheme Budget | Rs. 23,000 crores |
| Initial Salary for Freshers | Rs. 15,000 |
| Benefit Transfer Method | Direct transfer to bank accounts |
| Number of Beneficiaries | Around 2.1 crore new employees |
Key Features
- Financial Support: Freshers receive an equivalent of one month’s wage of up to Rs. 15,000 directly from the government, easing their financial burden as they start their careers.
- Eligibility: The scheme is available to freshers who have joined the workforce within the past year and are contributing to the EPF. Also, the salary limit remains to be Rs. 1 lakh per month.
- Direct Benefit Transfer: The funds are transferred directly into the bank accounts of eligible employees, ensuring timely and transparent disbursement.
Benefits
- Encourages Employment: By providing financial support, the scheme incentivizes freshers to join the workforce.
- Reduces Financial Strain: Freshers can manage their initial expenses better, such as relocation and work-related costs.
- Boosts Confidence: Financial backing can help boost the confidence of new employees as they embark on their careers.
Scheme B: Job Creation In Manufacturing
The “Job Creation In Manufacturing” scheme is designed to stimulate employment opportunities in the manufacturing sector, a critical component of India’s economy. This initiative focuses on creating a conducive environment for job growth and industrial expansion.
Employees and employers will receive an incentive at a specified rate based on their contributions to the EPFO during the first four years of work. Thirty lakh people are predicted to profit from the scheme. The project has been allotted ₹52,000 crore. The government believes there will be more job opportunities for skilled people across various sectors.
| Name | Details |
|---|---|
| Predicted Beneficiaries | Thirty lakh people |
| Project Budget | ₹52,000 crore |
Key Features
- Subsidies for Employers: Employers in the manufacturing sector receive subsidies to hire new employees, reducing the cost of expanding their workforce.
- Infrastructure Development: Investments are made in improving infrastructure to support manufacturing units, facilitating smoother operations and growth.
- Skill Development Programs: Training and skill development programs are offered to equip workers with the necessary skills to thrive in the manufacturing sector.
Benefits
- Boosts Employment: By lowering the cost of hiring, the scheme encourages manufacturers to create more jobs.
- Enhances Skills: Skill development initiatives ensure that the workforce is well-equipped to meet industry demands.
- Economic Growth: Increased employment in manufacturing can drive economic growth and contribute to the nation’s GDP.
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Scheme C: Support To Employers
The “Support To Employers” program aims to give employers the financial and administrative support they need to maintain and expand their businesses. This program aims to reduce some of the operational hassles faced by companies while also acknowledging their critical role in the economy.
Scheme C, valued at ₹32,000 crore, is designed to assist employers in providing extra work in all formal industries. For every additional employee, the central government will repay employers up to ₹3,000 per month for a maximum of two years toward their EPFO contribution.
| Name | Details |
|---|---|
| Scheme Name | Scheme C |
| Scheme Value | ₹32,000 crore |
| Employer Incentive | Central government will repay employers up to ₹3,000 p.m. per additional employee |
Key Features
- Financial Incentives: Employers receive financial incentives for maintaining or increasing their workforce, helping them manage labor costs effectively.
- Tax Benefits: Tax breaks and incentives are offered to employers who contribute to the EPF, encouraging them to provide better benefits to their employees.
- Operational Support: Assistance in areas such as compliance, regulatory requirements, and infrastructure development is provided to ensure smooth business operations.
Benefits
- Reduces Financial Strain: Financial incentives and tax benefits ease the financial pressures on employers, enabling them to invest more in their businesses.
- Encourages Workforce Stability: Support for maintaining or increasing workforce numbers helps in creating a stable employment environment.
- Promotes Business Growth: Operational support aids in overcoming logistical and regulatory challenges, fostering a growth-friendly business climate.
FAQs : EPFO Scheme
Ques 1. How many new schemes were introduced for EPFO in the Union Budget 2024?
Ans. The Union Budget 2024 included a total of three schemes for the employees and the Employee Provident Fund Organisation (EPFO).
Ques 2. What are the three recently launched schemes for EPFO?
Ans. The three schemes include- One Month’s Wage For Freshers, Job Creation In Manufacturing, and Support To Employers.
Ques 3. Who and when presented the three new schemes through the Union Budget 2024?
Ans. The Indian Finance Minister, Nirmala Sitharaman, introduced the three new schemes for EPFO while presenting the Union Budget on the 23rd of July 2024.
Conclusion
Though the budget is not up to the expectations of the citizens, as claimed, it includes so many things that could benefit in the long run. Like, if we talk about the three new schemes introduced in the Union Budget 2024, all these schemes could be beneficial for the employees and employers.
All they need is a successful implementation and the long-term benefits will be visible. The Finance Minister said that all the newly-introduced schemes have been made keeping the unemployment scenario of the country in mind. The government also believes that there will be employee retention and better employment in the upcoming years.