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7th Pay Commission: DA hike, salary increase, arrears clearance, DR benefits, TA, PF contribution - Latest updates
Minister for State for Finance, Anurag Thakur, has confirmed that all central government employees will get full benefits of DA starting July 1.
Updated : Apr 08, 2021, 01:34 PM IST | Edited by : Tanweer Azam
 "7th Pay Commission")
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In a good news for lakhs of lakhs of Central government employees and pensioners, Minister for State for Finance, Anurag Thakur, has confirmed that all central government employees will get full benefits of dearness allowance (DA) starting July 1. Thakur also confirmed that all the three pending installments of DA will be restored prospectively.
It may be recalled that Prime Minister Narendra Modi-led government at the Centre had frozen the three installments of DA for central government employees and DR for pensioners, due on January 1, 2020, July 1, 2020 and January 1, 2021, due to COVID-19 pandemic. The Centre's decision to restrore pending DA from July, 2021 would be a welcome news for about 50 lakh central government employees and over 65 lakh pensioners.
But, the DA hike from July 1 will only be effective from that day which means that central government employees would not get any arrears on non revision of DA for previous period.
"As and when the decision to release the future installments of Dearness Allowance due from 01.07.2021 is taken, the rates of DA as effective from 01.01.2020, 01.07.2020 and 01.01. 2021 will be restored prospectively and will be subsumed in the cumulative revised rates effective from 01.07.2021," Thakur said in a written reply in Rajya Sabha.
Notably, the central government employees currently get DA of 17 per cent. In 2020, a 4 per cent increase in DA was approved by Union Cabinet and this was meant to come into effect from January 1, 2020 but the outbreak of coronavirus forced the government to suspend the disbursement of DA at increased rates for central govermment emoployees along with DR for the pensioners.
The restoration of DA benefits from July 1 means that the salary of central government employees would increase significantly. The hike in DA will directly affect the DA, HRA, Travel Allowance (TA), medical allowance of Central government employees.
The Centre's decision to restore DA will also increase the PF balance of Central government employee. It is to be noted that the PF contribution of central government employees is calculated on the basis of basic salary plus DA.
