DA Update: According to media reports, along with 4 percent increase in dearness allowance in July, employees can also get 18 months DA arrears and interest on Provident Fund (PF).
There is good news for central government employees. Central employees are soon expected to get three good news regarding their salary. Dearness Allowance is revised twice a year in January and July, so it is set to be revised next month. According to media reports, in addition to DA, employees can also get 18 months DA arrears and interest on Provident Fund ( PF ). According to the report, the issue of payment of DA arrears of 18 months from January 2020 to June 2021 can be settled soon and central government employees can also get arrears of Rs 2 lakh at a time. The amount of DA dues is decided by the pay band and structure of the employees.
The government has already fixed the interest rate on Employees’ Provident Fund (EPF). Employees’ Provident Fund Organization (EPFO) will now deposit interest in the accounts of PF account holders. For the financial year 2021-22, the government has approved an interest rate of 8.10 percent on EPF.
Dearness allowance likely to increase by 4 percent
On the DA front, as the AICPI is at a higher level, the possibility of hike in dearness allowance to government employees is also high. The DA is revised based on changes in the All India Consumer Price Index. Retail inflation stood at 7.04 per cent in May, which is above the RBI’s comfort level of 2-6 per cent.
Let us tell you that in March, the Union Cabinet approved a 3 per cent hike in Dearness Allowance (DA) under the Seventh Pay Commission, thus reducing the DA to 34 per cent of the basic income. More than 50 lakh government employees and 65 lakh pensioners are getting benefits from this move. Dearness allowance is given to government employees, while dearness relief is given to pensioners.
Dearness allowance was stopped due to Corona epidemic
In view of the unprecedented situation arising due to the Kovid-19 pandemic, the Central Government had withheld three installments of DA and DR for January 1, 2020, July 1, 2020 and January 1, 2021. Finance Minister Nirmala Sitharaman, in a written reply to a question in the Rajya Sabha in August last year, said that withholding of DA and DR resulted in a savings of about Rs 34,402 crore.
In July 2021, the central government had increased the DA and DR for central government employees and pensioners from 17 per cent to 28 per cent respectively. Again in October 2021, the dearness allowance of central government employees increased by 3 percent.