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DA Hike, Increase in PF, Gratuity: 5 Recent Rule Changes Central Govt Employees Must Know

Union government has increased the dearness allowance to 28 per cent from 17 per cent

Union government has increased the dearness allowance to 28 per cent from 17 per cent

DA hike: As the dearness allowance is linked to the basic salary, a hike in DA will also raise the monthly provident fund (PF) and gratuity amount of the central government employees

7th Pay Commission, DA Hike: Good news for central government employees! After over one-and-half-year, the Union government has increased the Dearness Allowance (DA) and Dearness Relief (DR) of central government employees and pensioners. The move comes at a time when retail inflation has remained over 6 per cent for the two straight months. The surge in allowance will help millions of  beneficiaries to cope up with rising food and oil prices amid coronavirus pandemic. “Govt led by PM @NarendraModiji has approved an increase in Dearness Allowance to Central Govt. employees & Dearness Relief to pensioners to 28%, representing an increase of 11% over the existing rate of 17% of the Basic Pay/Pension," Union minister Piyush Goyal wrote on Twitter.

Commenting on Centre’s decision to raise dearness allowance of the central government employees, Sajai Singh, Partner, J Sagar Associates, said, “This is a welcome move since coronavirus has really shaken the economic foundation of the country and DA is paid to offset inflation. Inflation affects the price of everything and it’s impact may vary marginally from location to location, so hopefully this jump will bring relief to the beneficiaries."

Let’s take a look at the recent changes that central government employees must know

1) To provide some relief amid coronavirus pandemic, the Union government has surged the dearness allowance to 28 per cent from 17 per cent. The central government employees have been receiving 17 per cent DA since July, 2019. The Central stalled DA last year in the wake of coronavirus pandemic.

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2) The revised DA will be come into effect from July, 2021. A central government employee who gets Rs 18,000 per month, will see a hike of 11 per cent in his take-home salary. His salary will jump by Rs 5,040 from July. The Dearness Allowance from January 1, 2020 to June 30, 2021 will remain 17 per cent for government employees. There will be no DA arrears for the mentioned period.

3) As the dearness allowance is linked to the basic salary, a hike in DA will also raise the monthly provident fund (PF) and gratuity amount of the central government employees. So, PF, Travel Allowance and gratuity will go up for the employees and the pensioners.

4) The Centre this week told banks they can use social media application such as WhatsApp alongside SMS and email to send pension slips to pensioners after their account is credited. The decision was taken in order to ensure ease of living of the pensioners.

“Banks may also use social media apps WhatsApp etc in addition to sms and email. Accordingly, all pension disbursing banks should issue pension slip to pensioners after credit of pension on their registered mobile numbers through SMS and email (wherever available) also,” an official order stated.

5) The central government has recently extended the timeline for submission of bills to claim Leave Travel Concession (LTA) beyond May 31. “Representations have been received in this Department to extend the date of settlement of bills/claims beyond 31.05.2021 in view of the situation existing due to the Covid-19 and difficulties being faced in settling the claims/bills. It has been decided that Ministries/Departments may consider settlement of those claims/purchases made on or before 31.03.2021 beyond the due date i.e. 31.05.2021," the ministry of finance said in a statement.

It must be mentioned that the last date to settle LTC claims is usually by March 31. The Centre earlier relaxed the the deadline till May 31 due to coronavirus pandemic.

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first published:July 16, 2021, 16:18 IST