Budget 2024: Three new EPFO schemes to boost fresh employment in manufacturing sector

Union finance minister Nirmala Sitharaman on Tuesday announced three new schemes under the Employee Provident Fund Organisation (EPFO) with a total allocation of ₹1.07 lakh crore for new employees in the organised sector.

These new schemes will be a part of the Prime Minister's package for ‘Employment Linked Incentive.' It will be based on fresh enrolment in the EPFO scheme with focus on recognition of first-time employees and provide fiscal support to the employers. A major focus across schemes is to incentivize additional employment in the manufacturing sector.

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What are the new schemes for job creation?

Scheme A - This scheme worth ₹23,000 crore will provide one month wage to all persons newly entering the formal workforce across sectors. One month wage, up to a limit of ₹15,000 will be transferred across three instalments through a Direct Benefit Transfer (DBT) mode. Eligibility is limited to a salary of ₹1 lakh per month. This scheme is expected to benefit 2.1 crore persons entering the workforce.

Scheme B - An incentive will be provided at a specific scale directly to both the employee and the employer according to their EPFO contribution during first four years of employment. The scheme is expected to benefit 30 lakh people. ₹52,000 crore has been allocated for the scheme.

Scheme C - Worth ₹32,000 crore, scheme C is to support employers covering additional employment across all formal sectors. The central government will reimburse employers up to ₹3,000 per month for two years towards their EPFO contribution for each additional employee.

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What Nirmala Sitharaman said on the schemes?

Sitharaman said "our government will facilitate the provision of a wide array of services to labour, including those for employment and skilling.

A comprehensive integration of e-shram portal with other portals will facilitate such one-stop solution. ShramSuvidha and Samadhan portals will also be revamped to enhance ease of compliance for industry and trade.

The finance minister also said that the government will facilitate higher participation of women in the workforce by establishing working women hostels and creches in collaboration with the industry. The partnership will also organise women-specific skilling programmes and promote market access for products and services of women self-help group (SHG) enterprises.

(With PTI inputs)