7th Pay Commission news: Amid the COVID crisis, the government had ordered a freeze on the dearness allowance hike of Central government employees.
With the Budget 2021 just around the corner, expectations are that there would be some kind of announcement by the government regarding the 7the Pay Commission. The greatest expectations would be for a salary hike and then for restoration of dearness allowance.
1. Current DA
)
The central government employees are currently getting 17 per cent DA.
2. DA Jump
)
If the Centre decides to restore 4 per cent DA for July to December 2020 and add another 4 per cent DA for January-June 2021, then the net DA of the central government employees would jump to 25 per cent.
3. Salary hike
)
If the Centre decides to increase DA by 8 per cent it means that the monthly salary of the central government employees will increase considerably.
4. LTC allowance
)
The Centre has decided to give one time reimbursement/rescheduling charges paid by those employees who were made to pay cancellation charges for air/train tickets meant for their Leave Travel Concession (LTC) due to coronavirus outbreak.
5. Coronavirus pandemic
)
In April 2020, the finance ministry had decided to put on hold an increment in dearness allowance (DA) for 50 lakh central government employees and 61 lakh pensioners till July 2021 due to the COVID-19 crisis.
6. Gratuity
)
The draft rules mention that employees' allowance component cannot exceed 50 per cent of the total pay package, resulting which, companies or employers will have to allocate 50 per cent of the salary to basic salary component. This also means that there will be a consequent rise in gratuity and PF contribution of the employee.
7. Why is DA important for Central government employees?
)
The Dearness Allowance (DA) is revised twice a year so that the central government employees can tide over the rising inflation. The first installment of DA is announced between January to June while the second Tranche of DA is announced between July to December.
