Bruhaspati Samal
General Secretary
Confederation of Central Govt. Employees and Workers
Odisha State Coordination Committee, Bhubaneswar
eMail: samalbruhaspati@gmail.com, Mobile:9437022669
The
Union Budget 2025 holds immense significance for employees, workers,
and pensioners across the country, as it is expected to address
long-standing economic concerns and provide relief in areas such as pay,
pension, income tax, healthcare, and social security. With key
announcements like the Unified Pension Scheme (UPS) and the constitution
of the 8th Central Pay Commission (CPC) still awaiting formal
implementation, there is widespread anticipation that the upcoming
budget will bring much-needed clarity and progress on these matters.
The Gazette Notification dated 24th January 2025 on UPS has dissatisfied the employees and pensioners since the term Pension (Assured Pension, Minimum Pension and Family Pension) will henceforth be known as Payout (Assured Payout, Minimum Payout and Family Payout) which is in strict contradiction to the Press Release dated 24th August 2024 on UPS. The declaration of the Central Govt. promising to revolutionize the pension system by streamlining processes and ensuring equitable benefits through UPS is seen to be confusing, as if there would be no pension system in future.
Pensioners,
particularly those who rely solely on government pensions for their
livelihood, hope that the Union Budget 2025 will prioritize the
implementation of the UPS bringing a clarification on Pension and
Payout. Similarly, the declaration of the 8th Central Pay Commission
(CPC) on January 17, 2024, raised hopes of timely wage revisions for
government employees. However, the lack of a formal notification from
the Prime Minister’s Office or the Cabinet has left these employees in
suspense. Required Gazette Notification regarding constitution of 8th
CPC is still awaited. The Union Budget 2025 must allocate sufficient
funds for constitution of the Commission without further delays. This
would address the stagnation in wages and provide much-needed financial
relief to government employees across the country.
The freezing of Dearness Allowance (DA) and Dearness Relief (DR) for 18 months from January 2020 to June 2021 during the COVID-19 pandemic has been a major source of discontent among employees and pensioners. While the measure was justified as a temporary fiscal necessity, the government’s failure to release the withheld amount has left many feeling overlooked. This budget must address this issue by compensating the affected groups and instituting a mechanism for regular DA/DR adjustments in line with inflation.
Income tax policies have always been a focal point for employees and pensioners. Over the past two budgets, there has been a noticeable lack of significant tax relief measures. In the 2023 budget, the government increased the basic exemption limit for individual taxpayers under the new tax regime to Rs. 3 lakh and introduced a standard deduction of Rs. 50,000 for salaried taxpayers. However, the relief offered was modest and failed to address the rising cost of living. The 2024 budget brought marginal improvements but left key demands unaddressed, such as revising tax slabs and increasing deductions for senior citizens and pensioners. For the 2025 budget, pensioners are particularly hopeful that the government will exempt pensions up to Rs. 12 lakh per annum from income tax. This measure would recognize the financial constraints faced by retirees and alleviate their tax burden. Additionally, increasing the standard deduction to Rs. 1 lakh for salaried employees and pensioners would provide immediate relief to a broad section of the population. Revising income tax slabs to reduce rates across all levels and enhancing exemptions under Sections 80C, 80D, and 80TTB would further improve the financial well-being of taxpayers.
Healthcare is another area where employees and pensioners expect significant attention in the Union Budget 2025. Over the past two years, healthcare allocations have focused on improving infrastructure and expanding insurance schemes like Ayushman Bharat. While these initiatives are commendable, they often fail to address the specific needs of pensioners. The introduction of provisions for cashless treatment at all government hospitals for pensioners, based on the production of identity cards, would be a transformative step. Furthermore, increasing the deduction for medical expenses under Section 80D and including out-of-pocket expenses for non-insured treatments would provide much-needed relief.
Workers in sectors such as manufacturing, agriculture, and construction face unique challenges, including low wages, job insecurity, and lack of access to social security benefits. The upcoming budget should focus on measures to improve their working conditions and provide financial support. Expanding the scope of the Employees’ Provident Fund (EPF) and the Employees’ State Insurance (ESI) schemes to cover more workers, especially in unorganized sectors, would ensure better social security. Additionally, introducing productivity-linked wage incentives and revising the minimum wage structure to reflect current economic realities would boost morale and productivity.
The disparity in pay and benefits between different sectors and levels of government employment remains a contentious issue. The Union Budget 2025 must address these anomalies by ensuring that wage structures are fair and competitive. This includes revising allowances such as house rent allowance (HRA) and transport allowance to reflect the current cost of living, particularly in urban areas.
In terms of social security, the government’s efforts to introduce affordable housing schemes have been welcomed but require further expansion. Allocating resources for housing loans at subsidized rates and increasing the eligibility limit for such schemes would provide tangible benefits to employees and pensioners. Moreover, enhancing gratuity benefits and reducing the eligibility threshold under the Payment of Gratuity Act would ensure greater financial security for retirees. Education and skill development are also critical areas where employees and their families expect support. Introducing tax deductions for education expenses and increasing funding for skill development programs under schemes like the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) would empower workers and their families to adapt to changing job markets.
While the expectations from the Union Budget 2025 are high, it is essential to acknowledge the government’s fiscal constraints. Balancing these demands with the need to maintain fiscal discipline will be a formidable challenge. However, targeted measures addressing the most pressing issues can have a significant impact on the lives of millions. The Finance Minister must prioritize the welfare of employees, workers, and pensioners, ensuring that their contributions to the economy are duly recognized and rewarded. As the nation awaits the Union Budget 2025, there is a collective hope that it will usher in a new era of economic inclusivity and security. By addressing concerns related to pay, pensions, income tax, healthcare, and social security, the government can reaffirm its commitment to the well-being of its workforce and retirees. The budget has the potential to be a transformative moment, paving the way for a more equitable and prosperous future for all.
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