Under this internship scheme, which connects with opportunities in 500 top companies in the country, the interns will be given a monthly allowance, as well as a one-time assistance amount.
Finance Minister Nirmala Sitharaman presented Budget 2024-25 on July 23 highlighting multiple schemes under the Prime Minister's package, all aimed at boosting employment and skill development of citizens. One of these schemes was the much talked about ‘Internship Program’ that is set to affect at least one crore youth across the nation.
Budget 2024 has proposed this comprehensive scheme for internship opportunities for youth in 500 top companies in the coming five years. However, a few people in the industry have criticised some aspects of this scheme. One of these included the question of whether the government has consulted the industry regarding the rollout of this program.
Speaking to NDTV, Finance Secretary TV Somanathan clarified that the industry participation is ‘completely voluntary’. “We had consulted trade and industry on the broad issues of skilling and they have generally been very forthcoming in terms of saying that this is something they would like to partner on. They have not necessarily been consulted on the specific parameters of the scheme that's been outlined in the budget, no. But it is not contrary to what they are capable of doing,” he said.
The finance secretary further stated that the government will be paying 90 per cent of the allowance/stipend including the relocation and incidental costs. The volunteering companies will skill the individual in the trade that they are engaged in.
Under this internship scheme, which connects with opportunities in 500 top companies in the country, the interns will be given a monthly allowance, as well as a one-time assistance amount.
As per the Budget 2024 announcements, the youth will receive Rs 5000 as a monthly stipend and Rs 6000 as a one-time assistance. The first phase of the scheme will be for two years, while the second phase will be for three years.
Training Costs and CSR Funding: Companies will bear the training costs for the interns, utilising 10 per cent of their Corporate Social Responsibility (CSR) funds.
Application Process: Applications will be processed through an online portal, the details of which will be announced soon.
Work Experience and Skill Development: Interns will gain actual work experience and participate in skill development sessions, with at least half of their internship time spent in a job environment rather than a classroom.
The scheme is open to individuals aged 21 to 24 who are not employed or engaged in full-time education. For example, graduates from Indian Institutes of Technology (IIT), Indian Institutes of Management (IIM), and Indian Institutes of Science Education and Research (IISER) are not eligible.
The government has noted that the companies offering this internship opportunity will have to provide actual work experience and skill development sessions to the intern. “At least half the time spent on the internship should be in a job environment, and not in a classroom,” the finance secretary stated.
Finance Minister Sitharaman in her Budget speech said that the government is aiming for the creation of employment of about 4.1 crore youth over the next five years. Towards it, the finance minister said, “The government has allocated Rs 2 lakh crore.”
Among some noteworthy announcements of the government, the changes introduced to the national pension system has gained highlight. The new budget proposes to extend the 14 per cent deduction benefit to all employees under the employer’s contribution to NPS accounts, including those in the private sector and public sector banks.
Earlier, under Section 80CCD(2), Central and State Government employees could claim a deduction of 14 per cent of their salary for employer contributions towards their NPS accounts, while other employees were limited to 10 per cent.
Talking about the demands from a few sections of the populace regarding the comeback of the old pension scheme, the finance secretary said that such a reversion would not be possible. "One thing that I can say as the head of the committee - I can't speak for the government on this - is that a return to the old pension system is completely not feasible financially,” he said.
The secretary reasoned that “It will be a disaster for those citizens of India who are not government servants. It may be desirable for one class of people, but it will be a disaster for the rest, so that is not feasible."
Finance Secretary Somanathan also stated that after four rounds of consultations with committee staff associations through the National Council of Joint Consultative Machinery, the authorities have raised three core concerns regarding the pension system, namely:
1. Assurance of Pension Amount: Employees desire a guaranteed pension amount, independent of market fluctuations.
2. Protection Against Inflation: The scheme has to ensure that pensions have some form of inflation protection.
3. Minimum Pension: Introducing a minimum pension for those with service periods falling short of the guaranteed level.
"We will find a way to address these concerns to a satisfactory level, keeping fiscal prudence in mind," Somanathan added.