A complete reference blog for Indian Government Employees

Friday, 28 February 2014

Expected DA from Jul 2014 - AICPIN for Jan 2014

Expected DA from Jul 2014 - AICPIN for Jan 2014

All-India CPI-IW for January, 2014 declined by 2 points and pegged at 237
Consumer Price Index Numbers For Industrial Workers (CPI-IW) January 2014

According to a press release issued by the Labour Bureau, Ministry of Labour & Employment the All-India CPI-IW for January, 2014 declined by 2 points and pegged at 237(two hundred and thirty Seven). On 1-month percentage change, it decreased by 0.84 per cent between December and January compared with the rise of 0.91 per cent between the same two months a year ago.

The largest downward pressure to the change in current index came from Food group contributing -2.78 percentage points to the total change. At item level, Groundnut Oil, Onion, Brinjal Cabbage, Carrot, Gourd, Palak, Peas, Potato, Tomato and other Vegetable items, Sugar etc. are responsible for the decrease in index. However, this was compensated to some extent by Housing Index and the prices of Rice, Wheat, Fish Fresh, Goat Meat, Poultry, Cooking Gas, Electricity Charges, Petrol etc. putting upward pressure on the index.

The year-on-year inflation measured by monthly CPI-IW stood at 7.24 per cent for January, 2014, as compared to 9.13 per cent for the previous month and 11.62 per cent during the corresponding month of the previous year. Similarly, the Food inflation stood at 8.94 per cent against 11.49 per cent of the previous month and 14.08 per cent during the corresponding month of the previous year.

At centre level, Bhilwara recorded the highest decline of 8 points each followed by Kodarma (7 Points), Bokaro and Surat (6 Points each), Varanasi and Munger Jamalpur (5 Points each). Among others, 4 points decrease was registered in 8 centres, 3 points in 13 centres, 2 points in 12 centres and 1points in 9 centres. On the contrary, Amritsar and Quilon centres reported an increase of 4 points followed by Jharia (3 points). Among others, 2 points increase was observed in 6 centres and 1 point in 7 centres. Rest of the 14 centres’ indices remained stationary.

The indices of 38 centres are above All-India Index and other 39 centres’ indices are below national average. The index of Bhilwara centre remained at par with all-India index.

The next index of CPI-IW for the month of February, 2014 will be released on Monday, 31 March, 2014. The same will also be available on the official website www.labourbureau.gov.in.

Via: Expected DA
Share:

Cabinet Approved 10% Hike in Dearness Allowance from January 2014 for Central Government employees and Pensioners

Cabinet Approved 10% Hike in Dearness Allowance from January 2014 for Central Government employees and Pensioners

100% Dearness Allowance for Central Government employees and Pensioners with effect from 1.1.2014
The Union Cabinet today gave its approval to release an additional installment of Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners w.e.f. 1.1.2014 representing an increase of 10% over the existing rate of 90% of the Basic Pay/Pension, to compensate for price rise. The increase is in accordance with the accepted formula, which is based on the recommendations of the 6th Central Pay Commission.


Share:

Government approves Rs 1,000 min monthly pension under EPS-95

Government approves Rs 1,000 min monthly pension under EPS-95

Government today approved the proposal to ensure Rs 1,000 minimum monthly pension under a scheme of retirement fund body EPFO that would immediately benefit 28 lakh pensioners.

The decision to provide the entitlement under Employees' Pension Scheme-95, run by the Employees' Provident Fund Organisation, was taken by the Union Cabinet in its meeting held here.

The move will immediately benefit about 28 lakh pensioners including five lakh widows. There are 44 lakh pensioners.


Source: Central Government Staff News
[http://centralgovernmentstaffnews.blogspot.in/2014/02/government-approves-rs-1000-min-monthly.html]
Share:

Wednesday, 26 February 2014

50% DA MERGER - Impact of Merger of 50% Dearness Allowance with Basic Pay

50% DA MERGER - Impact of Merger of 50% Dearness Allowance with Basic Pay

Any possible to convert 50% of dearness allowance to dearness pay..!

Everyone's pointing fingers at "Parliament Election"...!


50% DA MERGER
50% of dearness allowance had been merged with basic pay for Central Government Employees and Pensioners with effect from 1.4.2004. This was followed the recommendation of 5th Central Pay Commission and the Union Government had decided to merge 50% of dearness allowance with baisc pay and issued orders on 1.3.2004.  (61% - 50% = 11%) 50% of dearness allowance merged with basic pay and remaining 11% had been issued as normal dearness allowance with effect from 1.1.2004.
Example : An employee's Basic Pay had revised as under on 1.1.2004 after 50 % DA merged with basic pay...

Basic PayDearness allowance 61%TotalBasic PayDearness PayRemaining percentage of Dearness allowance 11%TotalDifference

4000

2440

6440

4000

2000

660

6660

220

[And the next instalment of additional dearness allowance from 1.7.2004 declared as 3%, then the total dearness allowance went up to 14%. When implementation of 6th CPC, the above employee's basic pay was 4200 as on 1.1.2006, it just multiply with 1.86 and add with corresponding grade pay.]

Everybody thinking as more benefit on 50% of DA merge with basic pay...not like that..!

It is essential to CG Employees, of course for others, getting from some other way in hike in regular income...

For Example, an employee's basic pay Rs.10000 as on 1.1.2011, after merging of 50% dearness allowance the calculation is clearly shows the difference only 50 rupees per month...

Basic PayDearness allowance 51%TotalBasic PayDearness PayRemaining percentage of DA 1%TotalDifference

10,000

5100

15100

10000

5000

150

15150

50


"Note that the 50% of Dearness allowance will not merged with basic pay, instead of the amount showing only as 'Dearness Pay'. This amount will pay upto only the date of implementation of 7th pay commission. 

This is only as a advance hike for all employees before the implementation of 7th CPC. 

When fixation of pay on the recommendations of 7th CPC on 1.1.2016 according to the revised pay rules, the amount of ‘basic pay’ will be taken without dearness pay. 

For example, approximately basic pay of the above employee will be 12,250 as on 1.1.2016 . This amount only will be taken as Basic Pay for the calculation of pay fixation against the amount of 18,375. 

The enhanced amount will be given for us as Interim Relief for the period between announcement and implementation...It is not at all merged with ‘Basic Pay’..!
We can hear, what about hike in HRA and other entitlements...

The rate of HRA is provided according to the cities, like 10, 20 and 30%. Don't think all Central Govt Employees are getting 30%. And one more important points is the percentage hike in HRA will not applicable to those who are living in Government Quarters. In major metropolitan cities, thousands of employees are residing with Government Accommodation. They will pay more as HRA to Government and they don’t bother about increasing in HRA. 
Transport Allowance is providing according to their GP and classified cites, the amount is vary from 400 to 3200 plus DA thereon. The TA amount may decrease when 50% of DA merged with basic pay. 
So, ultimately hike in Basic pay only the factor is more beneficial in DA Merger.

But in 6th CPC there was no recommendation to convert dearness allowance as dearness pay each time the CPI increase by 50% over the base index recommended in pay commission report. 
All Central Government employees federations are showing maximum effort to achieve the demand of "Merger of 50% Dearness Allowance with Basic Pay" at this time. 
 Federations sources said, there will be chance to announce before March...!
Source: CGEN.in
[http://centralgovernmentemployeesnews.in/50-da-merger/]
Share:

Central Government to pay the Dearness allowance for state government employees

Central Government to pay the Dearness allowance for state government employees

Centre should pay DA of state govt employees as well: Mamata
Kolkata, Feb 22 (PTI) Centre should come forward and pay the dearness allowance of state government employees as well, West Bengal Chief Minister Mamata Banerjee demanded today.

"Whenever the Centre announces DA, state government employees should be given the same on a par (with central government employees).

"They (Centre) give it (to central government employees) before elections. Will others (state government employees) suck their thumbs?" Banerjee asked.

"We want the Centre to pay the DA for (state government) employees," Banerjee said.

Source: PTI
[http://www.ptinews.com/news/4432201_Centre-should-pay-DA-of-state-govt-employees-as-well--Mamata-.html]
Share:

Merger of 100% DA w.e.f. 1.1.2014 and Merger of 50% DA w.e.f. 1.1.2011

Merger of 100% DA w.e.f. 1.1.2014 and Merger of 50% DA w.e.f. 1.1.2011 demanded by Confederation of Central Government Gazetted Officers’ Organisation


Central gazetted officers finalise demands
A workshop organised by the Confederation of Central Government Gazetted Officers’ Organisations, Tamil Nadu region, has finalised the common minimum demands to be placed before the 7 Central Pay Commission, including a just and equitable pay at the entry level of Group ‘B’ officers.

It was also agreed upon at the workshop here on Saturday to demand a joint consultative machinery to redress their grievances and a minimum of five promotions during their tenure — from entry to Group ‘B’ level either by promotion or direct recruitment.

The workshop for the constituents of the Confederation sought merger of 50 per cent dearness allowance for all purposes with effect from January 1, 2011 or 100 per cent DA with effect from January 1, 2014 for the serving officers. Other demands included free and hassle-free medical facilities to Group ‘B’ officers and adequate travel entitlements.

Source : www.thehindu.com
[http://www.thehindu.com/news/national/tamil-nadu/central-gazetted-officers-finalise-demands/article5490705.ece]
Share:

Merger of Dearness allowance: AIRF Demanding Merger of 100% Dearness Allowance with Basic Pay

Merger of Dearness allowance: AIRF Demanding Merger of 100% Dearness Allowance with Basic Pay

 All India Railwaymen's Federation publishes the press statement regarding the merger of Dearness allowance with basic pay. The federation demanding merger of 100% Dearness allowance with basic pay for all purposes with effect from 1.1.2014.

The text of the press release has been reproduced and given below for your information...
Press Release of AIRF on Merger of Dearness Allowance and Announcement of Dearness Allowance w.e.f 01.01.2014.


PRESS RELEASE

New Delhi: February 21, 2014 - All India Railwaymen’s Federation(AIRF) has addressed the issue of merger of 100% Dearness Allowance with Basic Pay for all purposes w.e.f. 01.01.2014 to Hon’ble Prime Minister of India and the Finance Minister, Government of India, as Dearness Allowance will cross 100%. Unfortunately, there is no heed to this issue despite agitations at length over the Indian Railways by the AIRF.

It is also unfortunate that due 10% Dearness Allowance w.e.f. 1st

January, 2014 has still not been announced by the Government of India.

AIRF earnestly requests the Government of India to immediately announce Dearness Allowance w.e.f. 1st January, 2014 all along with merger of 100% Dearness Allowance with Basic Pay.

For General Secretary
All India Railwaymen’s Federation
Source: AIRF
New Delhi: February 21, 2014 - All India Railwaymen’s Federation(AIRF) has addressed the issue of merger of 100% Dearness Allowance with Basic Pay for all purposes w.e.f. 01.01.2014 to Hon’ble Prime Minister of India and the Finance Minister, Government of India, as Dearness Allowance will cross 100%. Unfortunately, there is no heed to this issue despite agitations at length over the Indian Railways by the AIRF.

It is also unfortunate that due 10% Dearness Allowance w.e.f. 1st

January, 2014 has still not been announced by the Government of India.

AIRF earnestly requests the Government of India to immediately announce Dearness Allowance w.e.f. 1st January, 2014 all along with merger of 100% Dearness Allowance with Basic Pay.


For General Secretary
All India Railwaymen’s Federation


Source: AIRF
Share:

Merger of 50% DA with Pay and grant of Interim Relief - NFIR

Merger of 50% DA with Pay and grant of Interim Relief - NFIR


NFIR
National Federation of Indian Railwaymen


No.II/95/Pt. VI
Dated: 20/02/2014
The General Secretaries of
Affiliated Unions of NFIR.

Brother,
Sub: Merger of 50% DA with Pay and grant of Interim Relief.

NFIR has been writing to the Government of India (including Prime Minister, Finance Minister etc) for merger of 50% DA with pay through its letters dated 10/01/2013, 05/08/2013, 27/09/2013. Also in its 27th National Convention held at Visakhapatnam from 10th  to 12th December, 2013, the Federation had passed a resolution demanding merger of 50% DA with Pay and grant of interim relief to employees of Central Government including Railway employees.

NFIR feels happy to convey that the Central Government has conceded the demand of the employees raised by the Federation.

Union Cabinet is likely to consider the issues to day for taking final decision. Federation will advise decision when taken by the Government. Federation expects that there may be Good News for all Central Government employees very soon.

Yours faithfully,
sd/-
(M.Raghavaiah)
General Secretary
Source: NFIR
Share:

Thursday, 20 February 2014

Cabinet approved terms of reference for 7th CPC, including merger of 50 per cent DA with basic pay

Cabinet approved terms of reference for 7th CPC, including merger of 50 per cent DA with basic pay

As per Hindu Businessline News the Cabinet approved terms of reference for seventh pay commission. This includes merging dearness allowance above 50 per cent with basic pay. The excerpt of Hindu Businessline News is reproduced below:-

Ahead of general election, the Centre today took key decisions to woo minorities and Government employees.

For minorities, the Cabinet has decided to form equal opportunity commission as suggested by Sachhar Committee. This commission will suggest ways to ensure equal opportunities in jobs, education and even finding house on rent for minorities. The commission is expected to be constituted soon.

Terms of reference for 7th pay commission
In order to benefit over 50 lakh employees and over 30 lakh pensioners, the Cabinet also approved terms of reference for seventh pay commission. This includes merging dearness allowance above 50 per cent with basic pay. Currently DA is around 90 per cent of basic pay and another hike of 10 per cent is expected soon. DA is calculated on the basis of change in retail inflation.

Source: Hindu Business Line
http://www.thehindubusinessline.com/economy/policy/cabinet-okays-setting-up-of-equal-opportunity-commission-coal-regulator/article5708924.ece
Share:

Cabinet likely to approve 7th CPC ToR : Inclusion of DA Merger and Interim Relief in 7th CPC ToR

Cabinet likely to approve 7th CPC ToR : Inclusion of DA Merger and Interim Relief in 7th CPC ToR



Inclusion of DA Merger and Interim Relief in 7th CPC Terms of Reference – Union Cabinet likely to approve the 7th CPC Terms of Refernce in the next meeting, media sources said.
“To woo central government employees ahead of the general elections, the United Progressive Alliance (UPA) government is expected to ask the Seventh Pay Commission to consider merging 50 per cent dearness allowance (DA) with basic pay of employees.
This will form part of the terms of reference (ToR) for the Commission, to be considered by the Cabinet this week.

According to officials, the Pay Commission’s ToR categorically states a proposal in this regard should be actively considered.

The increases will be even more appealing as the Centre is expected to increase the DA by 10 per cent to 100 per cent by the end of February. Usually, the DA is merged with basic pay when the former goes beyond 50 per cent. It is 90 per cent now, but has not been merged so far.

Assuming an employee gets Rs 100 as basic pay and Rs 100 as DA at present, the basic will rise to Rs 150, even if 50 per cent allowance is merged. . A higher basic pay will also impact the house rent allowance (HRA) of employees as it is calculated at 30 per cent of the basic pay for central government employees.
DA is linked to the consumer price index (industrial workers). The government uses CPI-IW data of the past 12 months to arrive at a quantum for calculating any DA hike. The allowance will be announced from January. As such, the retail inflation for industrial workers between January 1 to December 31, 2013 would be used to take a final call on the matter. The average inflation during this period had stood at 10.66 per cent.

Earlier this month, the government had constituted the Pay Commission under the chairmanship of former Supreme Court Judge Ashok Kumar Mathur.

The other members of the panel are Petroleum Secretary Vivek Rae (full-time member), National Institute of Public Finance and Policy Director Rathin Roy (part-time member) and Officer on Special Duty in the Expenditure Department Meena Agarwal (Secretary).

The Commission’s recommendations would be implemented from January 1, 2016, officials said. However, it may recommend interim relief as well, they added.

The Commission’s recommendations will directly benefit almost five million employees and three million pensioners. Employees of state governments, which will adopt the recommendations of the 7th Pay Commission will also benefit.

Some officials said the Cabinet is also expected to consider another proposal to modify the Prime Minister’s 15-point programme for minorities, which will enable allocation of at least 15 per cent of the total funds for welfare of minorities in major programmes such as National Rural Health Mission, Rashtriya Mahila Shiksha Abhiyan, Employment and Skill Development”.

Source: www.business-standard.com
http://www.business-standard.com/article/economy-policy/centre-plans-big-bonanza-for-central-govt-employees-114021901256_1.html]
Share:

Tuesday, 18 February 2014

Challenges before the Seventh Pay Commission : Central Government Employees

Challenges before the Seventh Pay Commission : Central Government Employees

- by Raj Kumar Ray (Financial Express)

 SUMMARY

Growth has fallen in the last couple of years eroding revenue while inflation remains stubbornly high. The new pay commission will have to factor in both concerns

Why does the government appoint a pay commission every decade?
A pay panel is appointed every decade to review and recommend the pay structure for central government employees taking into account various factors such as cost of living, inflation rate, revenue growth and fiscal deficit of the government, growth in workforce, private sector job scenario and wages, and economic growth. The government has so far appointed six pay commissions. The demand for a permanent pay commission set up through an Act of Parliament has been raised once but it was not accepted by the government.

Earlier this month, Prime Minister Manmohan Singh approved the constitution of the Seventh Pay Commission—to be headed by retired Supreme Court judge Ashok Kumar Mathur—to suggest the extent of hike in salaries of the 7-million-plus central government staff and pensioners with effect from 2016. Petroleum secretary Vivek Rae has been appointed as a full-time member, NIPFP director Rathin Roy will be part-time member and Meena Agarwal will be member-secretary of the new pay panel.

How did the process of pay hikes evolved?

The pay panel recommendations have evolved with time. The first central pay commission (CPC) adopted the concept of “living wage” to determine the pay structure of the government staff. The third CPC adopted the concept of “need-based wage”. The fourth CPC had recommended that the government constitute a permanent machinery to undertake periodical review of pay and allowances of its employees, but this was not accepted by the government. The sixth CPC suggested performance related incentive scheme (PRIS) to replace the ad hoc bonus and productivity-linked bonus schemes. The pay panel also suggested that the running pay band be extended to all grades of officers. Also, the sixth pay panel suggested slashing of the number of grades to 20 and one distinct pay scale for secretaries from the 35 existing earlier.

By how much have the public sector salaries increased every decade following the pay panels’ recommendations?

By and large, the salaries of central government staff have tripled every decade. The sixth CPC suggested 3 times increase in salaries from that of fifth CPC levels—it was 2.6 times for lower grade officials and slightly above 3 for higher grade staff. The increase in salary during fifth CPC was 3-3.5 times the fourth CPC levels.

What has been the fiscal implication of pay hikes?
Government finances have come under strain after implementations of each CPC. After the fourth CPC, the combined fiscal deficit of centre and states rose to 9.5% of GDP in FY87 from 7.7% in FY86. The impact was significantly harsh during the fifth CPC, especially for states—the combined fiscal deficit rose from 6.1% in FY97 to 7% in FY98 and then to 8.7% in FY99 with the aggregate deficit of states surging from 2.6% to over 4%.

In the case of the sixth CPC, the government expenditure increased by about Rs 22,000 crore during 2008-09—Rs 15,700 crore on the general budget and Rs 6,400 crore on the rail budget. The Rs 18,000 crore arrears were distributed in two years—40% in FY09 and 60% in FY10. The fiscal implication of sixth CPC coupled with fiscal stimulus in the form of higher spending and tax cuts after the Lehman crisis, increased Centre’s fiscal deficit to 6% in FY09 and 6.5% in FY10 from less than 3% in FY08.


What are the challenges before seventh CPC?
The new pay panel faces many challenges when it starts the process of reviewing the pay structures of babus. First, the economic growth has slowed sharply in the last 10 years—from over 9% between FY06 and FY08 to 4.5% in FY13. This means slower revenue growth and little room for scaling up expenditure on salaries.

Second, the Fiscal Responsibility and Budget Management (FRBM) target has already been revised more than twice after the Lehman crisis and the new target for lowering the fiscal deficit target to 3% of GDP is FY17. This again binds the government to restrict spending on salaries and wages.

Third and the most important factor, inflation has stayed high in the past few years—the CPI inflation (CPI-Industrial Workers and the new CPI) has averaged over 9% in the past eight years, which means cost of living has gone up significantly and hence necessitates higher compensation for workers. The dearness allowance of government staff has already touched 100%, which along with the rise in other allowances have more than doubled salaries since 2006.

Analysts expect the seventh pay panel to suggest 3-3.5 times hike in salaries across various grades from sixth CPC levels apart from a further rationalisation of government staff. Already, direct or permanent jobs in public sector have been shrinking while engagement of contract labour and outsourcing is on the rise. This trend is likely to continue given the fiscal imperatives of the government.

There is a perception that government salaries should rise faster at the higher grades and slowly at the lower grades to keep pace with private sector. It needs to be seen whether the seventh CPC retains the minimum:maximum ratio at sixth CPC level of 1:12. A hike in the ratio should not impinge the fisc much as the top level officials—joint secretaries and above—comprise less than 5% of the overall public sector workforce. The performance related incentives could also be reviewed to retain talent within the public sector. More than the fiscal implication, what matters is the productivity of the public sector. For instance, sluggish clearances needed for large projects have ruined investment and halved the growth rate in last three years. The silver-lining of the next CPC could be that it may boost the services sector growth and help revive the faltering economy from 2016 as higher salaries boost spending on housing, automobiles and consumer electronics.

Source: Challenges before the Seventh Pay Commission
[http://www.financialexpress.com/news/challenges-before-the-seventh-pay-commission/1226949/0]
Share:

Highlights of Interim Budget 2014-2015

Highlights of Interim Budget 2014-2015

  • ONE RANK ONE PENSION ACCEPTED FOR DEFENCE SERVICES.
  • FISCAL DEFICIT FOR 2013-14 WILL BE 4.6 PERCENT OF GDP. CURRENT ACCOUNT DEFICIT (CAD) WILL BE PEGGED TO$45 BILLION.
  • FOOD INFLATION STILL THE MAIN WORRY. DECLINES SHARPLY FROM 13.6 PERCENT TO 6.2 PERCENT.
  • IN THE CURRENT YEAR, AGRICULTURE GROWTH UP AT 4.6 PERCENT.
  • MERCHANDISE EXPORT  2013-14 $ 326 BILLION, UP BY 6.3 PERCENT.
  • DEFENCE ALLOCATION UP BY 10 PERCENT.
  • GOVERNMENT WILL CONTRIBUTE RS. 1000 CRORE TO NIRBHAYA FUND.
  • BIG EXCISE RELIEF TO AUTOMOBILE AND CAPITAL GOODS INDUSTRY.  ATTEMPTS TO BOOST DOMESTIC PRODUCTION OF MOBILE HANDSETS.
  • 67 CASES OF ILLEGAL OFF-SHORE ACCOUNTS DETECTED. ACTION UNDERWAY TO DETERMINE TAX LIABILITY. PROSECUTIONS FOR WILLFUL TAX EVASION LAUNCHED IN 17 OTHER CASES.
The Union Finance Minister Shri P. Chidambaram today sought to present UPA Government’s ‘unparalleled’ growth record, rejecting the argument of policy paralysis. He also outlined a vision for the future with ten major tasks that must be undertaken by the Government of the day. Keeping the fiscal deficit at 4.1 percent of GDP and acceding to the long-pending demand of one rank one pension among defence personnel were other key highlights of the Interim Budget presented by him.

The Minister enumerated path-breaking decisions taken by the Government in 2013-14. These include decontrol of sugar, gradual correction of diesel prices, rationalization of railway fare, starting the process for issue of new bank licenses and restructuring of DISCOMS.

Asserting that the economy is more stable today than what it was two years ago, the Minister said that the fiscal deficit is declining, the current account deficit has been contained, inflation has moderated, the quarterly growth rate is on the rise, the exchange rate is stable, exports have increased, and hundreds of projects have been unblocked.

The Cabinet Committee on Investment (CCI) and the Project Monitoring Group were setup. Thanks to the swift decisions taken by them, by the end of January, 2014, the way was cleared for completing 296 projects with an estimated project cost of Rs. 660,000 crore.

Shri Chidambaram stated that decline in GDP observed in the first quarter of 2013-14 will be arrested and the growth cycle will turn in the second quarter. He expressed the confidence that growth in Q3 and Q4 of 2013-14 will be at least 5.2 percent.

The Finance Minister stated that the annual GDP growth in the last ten years of UPA Government has been above the growth rate of 6.2 percent for the last 33 years. While it was 8.4 percent during UPA-I, it was 6.6 percent during UPA-II.

The Interim Budget estimates the plan expenditure in 2014-15 at Rs. 555,322 crore, almost the same as in the previous year. The non-plan expenditure has been raised slightly to Rs. 12,07,892 crore. Fiscal deficit for 2013-14 is likely to be contained at 4.6 percent of GDP and for 2014-15 at 4.1 percent.


PERFORMANCE
The Finance Minister Shri Chidambaram gave examples of fast growth in various sectors in the last ten years. India produces 263 million tonnes of foodgrains now as compare to 213 million tonnes ten years ago. Similar fast growths have taken place in coal production, power capacity and rural roads. Central Government’s expenditure on education has risen to Rs. 79,451 crore as compared to Rs. 10,145 crore ten years back. Expenditure on health has risen to Rs. 36,322 crore from Rs. 7,248 crore in a decade, the Minister said.

Agriculture sector has shown ‘stellar performance’ in 2013-14. Foodgrain production is estimated 263 million tonnes. Production of sugarcane, cotton, pulses, oilseeds and quality seeds has reached new records. Agricultural exports are likely to cross $ 45 billion. Agricultural credit is likely to touch 7,35,000 crore, exceeding the target of Rs. 7,00,000 crore. In the current year, agricultural GDP growth is estimated at 4.6 percent.

Merchandise exports rose by 6.3 percent in 2013-14 to $326 billion.
Eight National Investment and Manufacturing Zones (NIMZ) have been announced and another 5 NIMZ approved in-principle.

Infrastructure has grown by valuable addition to national highways, rural roads, railway tracks and port capacity. Besides, 19 oil and gas blocks were given out for exploration in 2013-14 and 7 new airports are under construction.

MAJOR PROPOSALS
The Government has accepted the principle of ‘one rank one pension’ for the defence forces and has allocated Rs. 500 crore for this purpose.

The target of agricultural credit has been raised to Rs. 8,00,000 crore. The effective rate of interest on farm loans, after interest subvention and incentive for prom payment, has been maintained at 4 percent.

Defence allocation has been enhanced by 10 percent to Rs. 2,24,000 crore. A moratorium period for all education loans taken upto 31.3.2009 has been proposed. It will benefit nearly nine lakh students borrowers by way of reduced interest burden.  Rs. 2,600 crore have been allocated for this purpose.

The Government will contribute Rs. 1000 crore to the Nirbhaya Fund on top of Rs. 1000 crore provided earlier.

Rs. 1200 crore Additional Central Assistance is being provided to the North-Eastern States, Himachal Pradesh and Uttarakhand.

A venture capital fund for Scheduled Castes is proposed to be set up with an initial capital of Rs. 200 crore.

The restructured  ICDS, which is being implemented in 400 districts, will be rolled out in the remaining districts.

Rs. 1000 crore is being proposed to the National Skill Development Cooperation in view of its success in providing skills to the youth.

A VISION FOR THE FUTURE
Among the tasks identified for the health of the economy in the years to come, the Minister called for keeping the fiscal deficit at 3 percent of GDP, promoting foreign investment, keeping inflation at a moderate level, and time- bound implementation of financial sector reforms. He also emphasized the need to rebuild infrastructure and promote manufacturing. Keeping subsidies under check, addressing the decay in cities and skill development will need to be given emphasis. States must share costs of flagship programmes so that more resources can be allocated to defence, railways etc.

REVENUE PROPOSALS

To give relief to automobile industry which is registering unprecedented negative growth, it is proposed to reduce the excise duty for the small cars, motor cycles, scooters and commercial vehicles by 4 percent. It will be cut from 12 percent to 8 percent.

The excise duty on SUVs is proposed to be reduced by 6 percent. From 30 percent to 24 percent.

In case of large and mid-segment cars, it is proposed to reduced excise duty by 3 percent i.e. 27/24% to 24/20%. All these reduced rates will be applicable upto June 30, 2014.

To stimulate growth in capital goods and consumer non-durable, it is proposed to reduce the excise duty from 12 to 10 percent on all goods for a period up to June 30, 2014. It is applicable to all goods falling under Chapter 84 and 85 of the Schedule to the Central Excise Act.

To encourage the domestic production of mobile handsets and reduce the dependence on imports, it is proposed to restructure the excise duty for category of mobile handsets. The rates will be 6 percent with CENVAT credit or 1 percent without CENVAT credit.

To boost domestic production of soaps and oleo chemicals, it is proposed to rationalize the customs duty structure on non-edible grade industrial oils and fractions, fatty acids and fatty alcohols at 7.5 percent.

It is proposed to withdraw the exemption from CVD on similar imported machinery to encourage domestic production of the specified road construction machinery.

The Government has succeeded in obtaining information in 67 cases of illegal Off-shore Accounts and action is underway to determine the tax liability as well as impose penalty. Prosecutions for willful tax evasion have been launched in 17 other cases.

Setting-up a Research Funding Organization that will fund research projects selected through a competitive process. Contributions to that organization will be eligible for tax benefit.

The Direct Taxes code (DTC) is ready and it will be placed on the website for a public discussion. The Finance Minister appeals to all political parties to resolve to pass the GST laws and the DTC in 2014-15.

Source: Central Government Employees News
[http://centralgovernmentstaffnews.blogspot.in/2014/02/central-government-employees-challenges.html]
Share:

Featured post

Cabinet approves release of an additional instalment of DA to Central Government employees and DR to Pensioners, due from 1.1.2019

Cabinet approves release of an additional instalment of DA to Central Government employees and DR to Pensioners, due from 1.1.2019   ...

Blog Archive

About The Author