7th Pay Commission: DA, DR, TA calculation, salary change from July 1 and other updates for central government employees, pensioners

7th Pay Commission updates: The Modi government has recently announced restoration of three pending DAs of the central government employees, beginning July 1.  Since the government had frozen DA of central government employees last year due to Covid 19 pandemic and now these employees are set to get their arrears, they are confused as in how this will be calculated. These government employees are also seeking clarity as on how these changes will affect their salary structure.  

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Currently, central government employees are getting DA at 17 per cent. It is expected that final DA that central government employees will get is 28 % (17% + 11%). As per AICPI data, a 3% increase in DA from January to June 2020, a 4% hike for July-December 2020, and a 4% increase from January-June 2021, are expected. This makes for 11 % hike and final DA turns out to be 28 per cent.  

Meanwhile, as far as salary is concerned, 7th CPC fitment factor also has a crucial role to play. As per 7th Pay Commission, the basic salary of employees is multiplied by the fitment factor, which is 2.57. This increases the government employees monthly salary, however, it will not affect their allowances.  

Travel Allowance (TA)will be extended later when DA will be added to salary with pending arrears. After the increase in DA, the monthly PF and gratuity contribution of central employees will also change.

Also, night duty allowance for a section of central government employees is also expected to come into effect from July.

Earlier, as per the recommendations of the 7th Pay Commission, the Department of Personal and Training (DoPT) issued guidelines in the first half of the last financial year regarding night duty allowance. The Department of Personal and Training (DoPT) issued guidelines for this. Although, all sorts of allowances are put on hold in the onslaught of the COVID-19 pandemic, it is expected that the news on hike in DA and DR in July will also bring clarity on hike in night duty allowances.

With the hike in DA, DR (Dearness Allowance) will also increase proportionally for central government pensioners.