An Organisation for the welfare of postal employees

Saturday, November 12, 2011

Grant of Hard Area Allowance to the Central Government employees posted in the Islands of UT of Lakshadweep other than Kavarati & Agati.

No. 12(4)/ 2008-E.11(B)

Government of India

Ministry of Finance

Department of Expenditure

New Delhi, 09th November, 2011

OFFICE MEMORANDUM

Subj: Grant of Hard Area Allowance to the Central Government employees posted in the Islands of UT of Lakshadweep other than Kavarathi and Agathi.

The undersigned is directed to refer to this Ministry’s O.M. No. 12(1)/ E-11(B)/ 03 dt. 01-03-2004 on grant of Hard Area allowance to Central Govt. Employees posted in Nicobar Group of Islands w.e.f. 01-04-2004 and subsequent O.M. No. 12(4)/ 2008-E.II(B), dated 29th August 2008, extending this allowance to all central government employees posted in Minicoy in Lakshadweep @ 25% of (basic pay + NPA, where applicable), w.e.f. 01-09-2008 which was accepted by the Govt. based on the reccomendations of the Sixth Central Pay Commission and to say that the proposal to also extend Hard Area allowance in Islands other than Minicoy of UT of Lakshadweep has been under consideration of the Government for some time.

2. The President is now pleased to decide that Central Government employees posted in Kitlan, Andrott, Kalpeni, Chetlat, Kadmat, Amini and Bithra Islands of Lakshadweep shall be pais Hard Area allowance @ 15% of (basic pay + NPA, where applicable), on the existing terms and conditions.

3. These order shall take effect from the date of issue.

4. In so far as the persons serving in the Indian Audit and Accounts Department are concerned, these orders issue in consultation with Comptroller and Auditor General of India.

5. Hindi version is attached.

Sd/-

(Madhulika P Sukul)

Joint Secretary to the Govt of India

Decisions on the recommendations of the Committee for Comprehensive Review of National Small Savings Fund (NSSF).


No. 6-1/2011-NS.II (Pt.)

Ministry of Finance

Department of Economic Affairs

(Budget Division)

------------------------------------------------------------------------------------------

New Delhi, the 11th November, 2011.

OFFICE MEMORANDUM

Sub: Decisions on the recommendations of the Committee for Comprehensive Review of National Small Savings Fund (NSSF).

The Thirteenth Finance Commission in its Report had, inter alia, recommended that all aspects of the design and administration of the NSSF be examined with the aim of bringing transparency, market linked rates and other much needed reforms to the scheme. As a follow up of this recommendation, the Government had constituted a Committee on 8th July, 2010, headed by Smt. Shyamala Gopinath, the then Deputy Governor, Reserve Bank of India for comprehensive review of NSSF. The terms of reference of the Committee included review of the existing parameters for the small saving schemes in operation and recommend mechanisms to make them more flexible and market linked; review of the existing terms of the loans extended from the NSSF to the Centre and States and recommend on the changes required in the arrangement of lending the net collection of small savings to Centre and States; review of other possible investment opportunities for the net collections from small savings and the repayment proceeds of NSSF loans extended to States and Centre; review of the administrative arrangement including the cost of operation; and review of the incentives offered on the small savings investments by the States.

2. The Committee submitted its report to the Government on 7th June, 2011. Comments/views of Department of Posts, Department of Revenue, Department of Financial Services, Department of Expenditure and all State/Union Territory Governments were sought on the recommendations made by the Committee.

3. The recommendations of the Committee have been considered in detail, taking into account the views/comments received from other Departments, States/UTs and representations received from various agents’ associations and others. After detailed examination the following decisions have been taken:-


Rationalisation of Schemes

(i) The maturity period for Monthly Income Scheme (MIS) and National Savings Certificate (NSC) will be reduced from 6 years to 5 years.

(ii) A new NSC instrument, with maturity period of 10 years, would be introduced.

(iii) Kisan Vikas Patras (KVPs) will be discontinued.

(iv) The annual ceiling on investment under Public Provident Fund (PPF) Scheme will be increased from Rs. 70,000 to Rs.1 lakh.

(v) Interest on loans obtained from PPF will be increased to 2% p.a. from existing 1% p.a.

(vi) Liquidity of Post Office Time Deposit (POTD) – 1, 2, 3 & 5 years – will be improved by allowing pre-mature withdrawal at a rate of interest 1% less than the time deposits of comparable maturity. For pre-mature withdrawals between 6-12 months of investment, Post Office Savings Account (POSA) rate of interest will be paid.


Interest Rates on Small Savings Instruments

(i) The rate of interest paid under Post Office Savings Account (POSA) will be increased from 3.5% to 4% p.a.

(ii) The rate of interest on small savings schemes will be aligned with G-Sec rates of similar maturity, with a spread of 25 basis points (bps) with two exceptions. The spread on 10 year NSC (new instrument) will be 50 bps and on Senior Citizens Savings Scheme 100 bps. The interest rates for every financial year will be notified before 1st April of that year.

(iii) Assuming the date of implementation of the recommendations of the Committee as 1st December, 2011, the rate of interest on various small savings schemes for current financial year on the basis of the interest compounding/payment built in the schemes, will be as given below:-

Instrument

Current Rate (%)

Proposed Rate (%)

Savings Deposit

3.50

4.0

1 year Time Deposit

6.25

7.7

2 year Time Deposit

6.50

7.8

3 year Time Deposit

7.25

8.0

5 year Time Deposit

7.50

8.3

5 year Recurring Deposit

7.50

8.0

5-year SCSS

9.00

9.0

5 year MIS

8.00 (6 year MIS)

8.2

5 year NSC

8.00 (6 year NSC)

8.4

10 year NSC

New Instrument

8.7

PPF

8.00

8.6

(iv) Payment of 5% bonus on maturity of MIS will be discontinued.


Commission to Agents

(i) Payment of commission on PPF schemes (1%) and Senior Citizens Savings Scheme (0.5%) will be discontinued.

(ii) Agency commission under all other schemes (except MPKBY agents) will be reduced from existing 1% to 0.5%.

(iii) Commission at existing rate of 4% will continue for Mahila Pradhan Kshetriya Bachat Yojana (MPKBY) agents.

(iv) Incentives, if any, paid by the State/UT Governments will be reduced from the commission paid by the Central Government.


Investments from NSSF

(i) The minimum share of States in net small savings collections in a year, for investment in State Governments Securities, will be reduced from 80% to 50%. The remaining amount will be invested in Central Government securities or lent to other willing States or in securities issued by infrastructure companies/agencies, wholly owned by Central Government.

(ii) Yearly repayment of NSSF loans made by Centre and States, will be reinvested in Central and State Government securities in the ratio of 50:50.

(iii) The period of repayment of NSSF loans by Centre and States will be reduced to 10 years, with no moratorium.

(iv) For the current financial year the prevailing interest rate of 9.5% will continue. From 1st April, 2012 revised interest rate will be notified.

(v) Half yearly payment of interest by the Centre and the States will be introduced.

(vi) Interest rate on existing investments from NSSF in Central Government securities till 2006-07 will be re-set at 9% and on those from 2007-08 till 2010-11 will be re-set at 9.5%.


Operational Issues of NSSF

(i) A Monitoring Group drawn from Ministry of Finance, Reserve Bank of India, Department of Posts, State Bank of India, other select banks and select State Governments will be set up to resolve various operational issues like reducing the time lag between collection and investment, etc.

4. Necessary notifications, including those requiring amendments to rules of various small saving schemes and National Small Savings Fund (Custody & Investment) Rules, 2001 will be notified separately. The above decisions will take effect from the dates to be specified in the notifications.

5. This has the approval of Finance Minister.

Sd/-

(Shaktikanta Das)

Addl. Secretary to the Govt. of India


Friday, November 11, 2011

Govt hikes Interest rates on PPF, Post Office Small Savings Schmes

In a bonanza to millions of small savers, the government on Friday increased interest rates on deposit schemes offered by post offices, like savings account, Monthly Income Scheme and Public Provident Fund.

While post office savings accounts ( POSA) will fetch 4 per cent interest, up from 3.5 per cent, the Monthly Income Scheme (MIS) and the Public Provident Fund (PPF) will earn an interest of 8.2 per cent and 8.6 per cent respectively, a government release said.

The maximum increase is in the one-year fixed deposits-- from 6.25 per cent to 7.7 per cent. The interest rate on other time maturities has been hiked as well. The new rates will be applicable from the date of notification which will be announced soon.

The decision to hike interest rates, which is in line with the recommendations of Shyamala Gopinath Committee, will make small savings schemes more attractive and returns would be in sync with market rates.

The government, however, decided to discontinue the Kisan Vikas Patras (KVPs) and lowered the maturity period for MIS and NSCs to five years from existing six years. It also introduced the National Savings Scheme (NSC) with 10-year maturity. The annual investment ceiling in PPFsavings has been increased to Rs one lakh from the present limit of Rs 70,000, but it would be costlier to obtain loans from the savings under as lending rate has been doubled to two per cent.

The government has scraped five per cent bonus on MIS and has also done away with commission for agents on PPF and Senior Citizens Savings Schemes.

The finance ministry also said the payment of commission on PPF schemes and senior citizens savings scheme will be discontinued and the agency commission under all other schemes (except Mahila Pradhan Kshetriya Bachat Yojana (MPKBY) agents will be halved to 0.5 per cent.

According to the Gopinath Committee, the agents were paid around Rs 2,400 crore commission in 2010-11. Incentives, if any, paid by the state/UT governments will be reduced from the commission paid by the central government, it added.

In line with Gopinath Committee's suggestions, the government also decided to align rate of interest on small savings schemes with G-Sec rates of similar maturity, with a spread of 25 basis points (bps) with two exceptions. "The interest rates for every financial year will be notified before 1st April of that year," it said.

It further said the minimum share of states in net small savings collections in a year for investment in state government securities will be reduced from 80 per cent to 50 per cent. The remaining amount will be invested in central government securities or lent to other willing states or in securities issued by infrastructure companies/agencies, wholly owned by central government, it added.

Source: Times of India

Vaikom Area Convention

The Vaikom area Convention of FNPO Unions was held on 10.11.2011 at Vyapara Bhavan hall, Vaikom. The meeting was presided by Shri.V.T.Uthup, State Asst. Secretary NUPE Group ‘C’. Smt. Sreeletha Balachandran, Municipal Chairperson, Vaikom inaugurated the convention and the official web site of FNPO KOTAYAM DIVISION (www.fnpokottayamdivision.blogspot.com). Prominent Congress leaders Adv.V.V.Sathyan KPCC Member, Sri. P N Babu President Vaikom Block Congress Committee, Sri. B Anilkumar DCC General Secretary, Sri. Mohan D Babu KPCC Member, Sri. Bobin, Sri. K N Sreekumar and our divisional level leaders addressed the convention.

A seminar and detailed discussion on various issues relating to GDS employees were also conducted.






Source: www.fnpokottayamdivision.blogspot.com