The interest free advance will give a big boost to employees, who can spend the amount for the upcoming festivals.
New Delhi: 7th Pay Commission — The government might announce Special Festival Advance Scheme for central employees before the festive season of Holi, media reports have said. The Union government under the Special Festival Advance Scheme will give Rs 10,000 to the central employees aimed at stimulating consumer spending in the economy in an effort to fight the slowdown due to the ongoing COVID-19 pandemic.
The interest free advance will give a big boost to employees, who can spend the amount for the upcoming festivals, reports added. This is not the first time that the government will be giving the festive advance, if it does so this year. In 2020, Finance Minister Nirmala Sitharaman had announced Special Festival Advance Scheme revived as a one-time measure for both Gazetted and non-Gazetted employees.
The Special Festival Advance Scheme was announced as a one-time measure to stimulate demand. All Central Government employees were allowed to get an interest-free advance of Rs 10,000, to be spent by 31st March, 2021 on the choice of festival of the employee. The interest-free advance was recoverable from the employee in maximum 10 instalments.
The employees were provided a pre-loaded RuPay Card of the advance value. The Government also bore the Bank charges of the card. Disbursal of advance through RuPay card ensures digital mode of payment, resulting in tax revenue and encouraging honest businesses. The one-time disbursement of Special Festival Advance Scheme (SFAS) was estimated to amount to Rs. 4,000 crore.
In a 7th Pay Commission related news, government employees have also been desperately waiting for the hike in dearness allowance that will lead to a substantial hike in the salary of the central government employees. At present, central employees get DA of 31 percent, while they are expecting a further increase of DA by 3 percent. This will take the total DA to 34 percent. In the aftermath of the COVID-19 crisis, all eyes are fixed on the government’s announcement. Dearness Allowance is calculated by multiplying it by the basic salary. As per the calculation of Dearness Allowance, the government keeps changing the DA after every 6 months or so, which in result increases the salary of the employees so as to tackle inflation. In October last year, DA was increased from 28 percent to 31 percent.
