Big Bonanza for government employees: Rs 10,000 advance to all, LTC cash voucher Check Full Details Here

New Delhi: In what could give a major boost to the government employees, Finance Minister Nirmala Sitharman on Monday announced a host of schemes.

The Finance Minister said that the Centre will launch `LTC Cash Voucher Scheme` and `Special Festival Advance Scheme`. The Finance Minister also announced a special festival advance of Rs 10,000 for all gazetted and non gazetted officers. This scheme, she explained is being revived and will be one time only.

Addressing a press conference, the FM said, announced a Rs 12,000 crore interest-free 50-year loan to states for spending on capital projects. Out of the Rs 12,000 crore, Rs 1,600 crore will be given to north-eastern states and Rs 900 crore will be for Uttrakhand and Himachal Pradesh. Rs 7,500 crore will be for the remaining states. Rs 2,000 crore will be given to states that fulfill pre-stated reforms.

LTC Cash Voucher scheme

Under the LTC Cash Voucher scheme, government employees can opt to receive cash amount to leave encashment plus three times the ticket fare, to buy items which attract a GST of 12 per cent or more. Sitharaman went on to say that only digital transactions will be allowed and a GST invoice will have to be produced.

This means central government employees who are eligible to claim LTC will be able to avail leave encashment benefit in lieu of travel expenses. The money can thereafter be used by them towards discretionary spending.

“If Central government employees opt for it, this will cost around Rs 5,675 crore. The employees of PSBs and PSUs allowed to avail this facility, and for PSBs and PSUs the cost will be Rs 1,900 crores. The demand infusion in the economy by central govt and PSUs will be approx Rs 19,000 crore,” said Nirmala Sitharaman.

“Even if 50 per cent of the States opt to give this facility, we think that this will bring in Rs 9,000 crores,” she added. So the total benefit under the LTC Voucher scheme can be roughly Rs 28,000 crore. Another boost worth Rs 28,000 crore can be gained if the private sector chips in. 

Special Festival Advance scheme

Sitharaman also announced the Special Festival Advance scheme to boost spending among central government employees.

Sharing details about the Special Festival Advance scheme, Nirmala Sitharaman said that it will be available up to March 31, 2021. The amount will be given to central government employees as a prepaid RuPay card. The amount that will be granted is Rs 10,000 crore.

The festival advance earlier from non-gazetted employees was at Rs 4,500. However, this was abolished under the 7th Pay Commission. But the government has planned to revive it as a one-time move to boost consumer spending.

“Special Festival Advance Scheme for non-gazetted employees is being revived as a one-time measure, for gazetted employees too. All central govt. employees can now get an interest-free advance of Rs 10,000, in the form of a prepaid RuPay Card, to be spent by March 31, 2021,” Sitharaman said.

Sitharaman went on to say that the one-time disbursement of Special Festival Advance scheme is expected to amount to Rs 4,000 crore. “If given by all state governments, another Rs. 8,000 crores is expected to be disbursed. Employees can spend this on any festival,” the finance minister said.

“The interest-free advance of Rs 10,000 under the Special Festival Advance Scheme to be paid back in 10 instalments.”

 

SOURCE:  NEWS AGENCIES