12-Sep-2017: Cabinet approves Payment of Gratuity (Amendment) Bill, 2017.
The Union Cabinet has given its approval for introduction of the Payment of Gratuity (Amendment) Bill, 2017 in the Parliament.
The Amendment will increase the maximum limit of gratuity of employees, in the private sector and in Public Sector Undertakings/ Autonomous Organizations under Government who are not covered under CCS (Pension) Rules, at par with Central Government employees.
Background: The Payment of Gratuity Act, 1972 applies to establishments employing 10 or more persons. The main purpose for enacting this Act is to provide social security to workmen after retirement, whether retirement is a result of the rules of superannuation, or physical disablement or impairment of vital part of the body. Therefore, the Payment of Gratuity Act, 1972 is an important social security legislation to wage earning population in industries, factories and establishments.
The present upper ceiling on gratuity amount under the Act is Rs. 10 Lakh. The provisions for Central Government employees under Central Civil Services (Pension) Rules, 1972 with regard to gratuity are also similar. Before implementation of 7th Central Pay Commission, the ceiling under CCS (Pension) Rules, 1972 was Rs. 10 Lakh. However, with implementation of 7th Central Pay Commission, in case of Government servants, the ceiling now is Rs. 20 Lakhs effective from 1.1.2016.
Therefore, considering the inflation and wage increase even in case of employees engaged in private sector, the Government is of the view that the entitlement of gratuity should be revised for employees who are covered under the Payment of Gratuity Act, 1972. Accordingly, the Government initiated the process for amendment to Payment of Gratuity Act, 1972.
11-Aug-2017: Push for law to ensure transparency rules
The government could consider introducing a new law to ensure transparency of rules, the Economic Survey has recommended, stressing that the ‘opaque mesh’ of regulations prevalent in India not only make life difficult for citizens who cannot feign ignorance of the rules as a valid defence, but also act as a magnet for corruption and endless litigation.
The problem is that it is not easy for ordinary citizens [and businesses] in India to navigate the multitude of rules, regulations, forms, taxes and procedures imposed by various tiers of government. Moreover, these rules frequently change and sometimes contradict each other. Arguing that India would benefit enormously if the average citizen could easily access the latest rules and regulations in a comprehensible format, the survey suggests a Transparency of Rules Act (TORA) as a possible solution.
Explaining that it is not referring to the content of the rules but solely about the ease of finding out what the citizen is expected to so, the Survey said even government officials struggle to keep up with ‘the latest version’ of complicated rules.
The TORA is an attempt to change in some ways the relationship between the average normal citizen and the State. All forms of governance are based on citizens being expected to follow the rules. Unfortunately, in India, very often, the rules are not so transparent. Specifically not the grand laws passed in Parliament, but the administrative rules, forms, procedures that citizens have to follow.
3-Aug-2017: Lok Sabha passes NABARD (Amendment) Bill, 2017
The National Bank for Agriculture and Rural Development (Amendment) Bill, 2017 was introduced by the Minister of Finance, Mr. Arun Jaitley in Lok Sabha on April 5, 2017. The Bill seeks to amend the National Bank for Agriculture and Rural Development Act, 1981.
The 1981 Act provides for the establishment of the National Bank for Agriculture and Rural Development (NABARD). NABARD is responsible for providing and regulating facilities like credit for agricultural and industrial development in the rural areas.
Increase in capital of NABARD: Under the 1981 Act, NABARD may have a capital of Rs 100 crore. This capital can be further increased to Rs 5,000 crore by the central government in consultation with the Reserve Bank of India (RBI). The Bill allows the central government to increase this capital to Rs 30,000 crore. The capital may be increased to more than Rs 30,000 crore by the central government in consultation with the RBI, if necessary.
Transfer of the RBI’s share to the central government: Under the 1981 Act, the central government and the RBI together must hold at least 51% of the share capital of NABARD. The Bill provides that the central government alone must hold at least 51% of the share capital of NABARD. The Bill transfers the share capital held by the RBI and valued at Rs 20 crore to the central government. The central government will give an equal amount to the RBI.
Micro, small and medium enterprises (MSME): The Bill replaces the terms ‘small-scale industry’ and ‘industry in the tiny and decentralised sector’ with the terms ‘micro enterprise’, ‘small enterprise’ and ‘medium enterprise’ as defined in the MSME Development Act, 2006. Under the 1981 Act, NABARD was responsible for providing credit and other facilities to industries having an investment of upto Rs 20 lakh in machinery and plant. The Bill extends this to apply to enterprises with investment upto Rs 10 crore in the manufacturing sector and Rs five crore in the services sector.
Under the 1981 Act, experts from small-scale industries are included in the Board of Directors and the Advisory Council of NABARD. Further, banks providing loans to small-scale, tiny and decentralised sector industries are eligible to receive financial assistance from NABARD. The Bill extends these provisions to the micro, small, and medium enterprises.
Consistency with the Companies Act, 2013: The Bill substitutes references to provisions of the Companies Act, 1956 under the NABARD Act, 1981, with references to the Companies Act, 2013. These include provisions that deal with: (i) definition of a government company, and (ii) qualifications of auditors.