7th Pay Commision Dearness allowance: This update will not bring cheer to central government employees

• Follow

A new statement has been issued by the government regarding dearness allowance (DA). The government has made it clear that the dearness allowance of central government employees will not be increased until July 1, 2021. They will get the benefit of dearness allowance at the old rates only. At present, central employees and pensioners get DA of 17%.

More than 52 lakh central employees

At present, there are more than 52 lakh central government employees. Apart from this, there are more than 60 lakh pensioners. At present, central employees get 17% DA. It was estimated that central employees would get 28% DA.

Anurag Thakur, MoS (Finance), recently said in Parliament that central government employees and pensioners will get full benefits of dearness allowance starting July 1, with all the three pending instalments being restored retrospectively. The government had also made it clear that no arrears will be received from January 1, 2020 to June 30, 2021.

Dearness allowance is still 17%

Right now, the Dearness Allowance is 17%, which was being talked about to be increased to 28 percent from July 1, 2021. The calculation of dearness allowance is made on the basis of basic salary. Travel allowance also increases along with Dearness Allowance. In this case, TA will also increase as DA increases. Due to increase in DA and TA, the share of allowance for central employees will increase and their net CTC will increase.

Impact on salary

According to the rules of the Seventh Pay Commission, the salary of a central government employee is divided into three parts. Which includes his basic salary, allowance and deduction. Net CTC is a central government employee who is the 7th CPC fitment factor and the sum of basic pay multiplied by all allowances. Basic salary has to be multiplied by the fitment factor (currently it is 2.57) to find the net CTC. After this, the allowance is added.