Big Setback For 50 Lakh Govt Employees: Travel Allowance Won’t Increase From July 1; Find Out Why?
Central govt employees, both serving and retired, who were scheduled to receive a hike in their Dearness Allowance (DA) and Dearness Relief (DR) respectively from July will not be receiving a corresponding hike in Travel Allowance (TA).
Why TA Won’t Increase
The reason for this is that their present DA rate is under 25%. But as per a rule of the 7th Pay Commission, the rate must be at least 25% or above.
The current DA rate for central govt employees is 17% which came into effect from July 2019 and was once more subject to revision from January 2020.
A hike of 4% which took the new DA rate to 21% was approved by the Union Cabinet which was set to roll out come January 1, 2020.
New DA/DR Rate Implementation Suspended
However this revision and its disbursement was halted due to the pandemic. The suspension allowed the govt to accumulate savings of Rs 37,430.08 crore.
Now the Centre will be going ahead with restoration of DA/DR payments which was to be completed in 3 installments- from January to June 2020, July to December 2020, and January to June 2021.
Minister of State (MoS) for Finance, Anurag Singh Thakur clarified to the Parliament that the allowance benefits will be rolled out to all Centre employees from July 1.
Payment Installments And New Hikes
We had earlier reported on DA hikes according to a data release from All India Consumer Price Index (AICPI). It goes as follows-
The installments of:
- January to June 2021- will see a 4% DA hike
- January to June 2020- 3% DA hike
- July to December 2020- 4% DA hike
which takes the total DA calculation to 28%.
But it must be noted that any DA hikes will come into effect from July 1 only.
The implication here is that for the previous period any arrears for non-revision of DA will not be received by the employees.