Special Festival Advance Scheme Launch by Central government
- Finance Minister Nirmala Sitaram announces LTC Cash Voucher and Festival Advance Scheme
- The scheme will also benefit employees of public sector banks
- More than 1 crore central employees of the country will benefit
The central government today made a big announcement to boost the economy and alleviate economic hardships during the festive season. In this regard, Finance Minister Nirmala Sitaram announced the LTC Cash Voucher and Festival Advance Scheme. Under the scheme announced today, more than 1 crore employees of the Center will be given cash vouchers for Leave Travel Concession (LTC). Apart from this, under the festival advance scheme, employees get Rs. Up to Rs 10,000 will also be available.
What is LTC Scheme?
Under this, government employees will get a cash voucher from which they can spend and this will also boost the economy. Employees of public sector banks will also benefit. The cash payment in lieu of LTC which will be digital will be for 2018-21. Under this train or plane fare will be paid and it will be tax free. For this the employee's rent and other expenses should be three times. Similarly goods or services have to be taken from the seller registered in GST and payment has to be made digitally. The finance minister said this would generate about Rs 28,000 crore in demand economy through the expenditure of central and state employees.
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Festival Advance Scheme
The Finance Minister informed that the Festival Advance scheme is being launched only once again this year. Under this, all types of employees will be given an advance of Rs 10,000, which they can deposit in 10 installments. A will be available until March 31, 2021. It will be given as a prepaid card.
Will provide interest free loans to the states
To boost economic activity, the central government has given Rs. 12 thousand crore interest free loan. The loan must be repaid in 50 years. It will have three parts- the first Rs. 2500 crore will be given to Northeast, Uttarakhand and Himachal. After this, as per the recommendation of the Finance Commission, Rs. 7500 crore will be given to other states. Third, Rs. Of the Rs 2,000 crore, it will be given to states that will implement at least three of the four announced self-reliance schemes. The full loan will be disbursed before March 31, 2021. This will be in addition to the loans already available for the states.
Finance Minister Nirmala Sitharaman today announced a special Festival Advance Scheme for central government employees revived as a one-time measure. Festival advance along side similar advances were abolished on the advice of the 7th pay commission. But to spur consumer demand in an economy hit by coronavirus pandemic, the govt decided to revive it as a one-time measure.
"It is suggested to revive festival advance to govt employees for festivals up to 31st January, 2021," the govt said.
Here are 5 things to understand about the festival advance scheme:
- 1) Interest free advance of ₹10,000 to be recoverable in maximum 10 instalments
- 2) This ₹10,000 advance will come as a pre-paid rupay card, which may be availed and spent by March 31, 2021.
- 3) the govt expects to disburse ₹4000 crore under this advance scheme
- 4) If given by state governments, another ₹8000 crore is probably going to be disbursed. Assuming 50% adoption by states the estimate is ₹4000 crore.
- 5) Additional consumer demand generated are going to be ₹8000 crore.
To stimulate demand within the economy, the govt also announced giving out cash vouchers to central government employees this year in lieu of leave travel concession (LTC) fare which might be spent only on buying non-food GST-rated items.
Union Territory, J&K, extends air travel limits to the Northeast
Earlier, the central government extended the air travel limit under the LTC scheme in the North East states, Jammu and Kashmir (J&K), Andaman and Nicobar and Ladakh by two years to September 25, 2022. Under this, any employee of the Central Government can go to these places by air. In addition, employees who are not eligible for Air Fare will also get the benefit of this scheme. Such employees will have to travel in economy class.
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