7th Pay Commission: Government issues gratuity, cash payment details of retired employees for THIS period-- Check rate of interest over varying time period

The Ministry of Finance’s Department of Expenditure has issued gratuity, cash payment details of retired Central government employees from January 2020 to June 2021.  

The department has issued an office memorandum (OM) informing the same. The OM mentioned in regard to the payment of Dearness Allowance (DA) during the period from January 01, 2020 to June 30, 2021. The rate of DA during the said period shall remain at 17 per cent of basic pay, the same has been enhanced to 28 per cent of basic pay subsuming additional instalments arising on January 01, 2020 (4 per cent), July 01, 2020 (3 per cent) and January 01, 2021 (4 per cent) payable with effect from July 01, 2021. 

As per the existing provisions contained in Central Civil Services (Pension) Rules 1972, DA on the date of retirement or death is reckoned as emoluments for the purpose of calculation of gratuity. Also, as per the existing provisions contained in CCS (Leave) Rules 1972, pay admissible on the date of retirement plus DA on that are reckoned for the purpose of calculation of cash payment in lieu of leave, the OM mentioned. 

The Department of Expenditure said in the OM that in view of the provisions of the aforesaid orders of this Ministry dated April 23, 2020 and July 20, 2021, calculation of gratuity and cash payment in lieu of leave-in respect of Central Government employees who retired on or after January 01, 2020 and up to June 30, 2021 are required to be made based on the rate of DA at 17 per cent of basic pay. 

The OM also reads that keeping in view that gratuity and cash payment in lieu of leave are one-time retirement benefits admissible to employees on retirement and employees who retired during the period from January 01, 2020 to June 30, 2021 have been allowed lesser amount than what would have been calculable but for the aforesaid orders of this Ministry dated April 23, 2020 and July 20, 2021, the matter has been considered sympathetically with a view to allowing the same to such employees. 

“Accordingly, the President is pleased to decide that in respect of Central Government employees who retired on or after January 01, 2020 and up to June 30, 2021, the amount of DA to be taken into account for calculation of gratuity and cash payment in lieu of leave will be deemed under; Employees retiring during the period and the Notional Percentage of Dearness Allowance (DA) for calculation purpose will be:  

From January 01, 2020 to June 30, 2020 -- 21 per cent of basic pay  

From July 01, 2020 to December 31, 2020 – 24 per cent of basic pay 

From January 01, 2021 to May 30, 2021 – 28 per cent of basic pay  

All other conditions as stipulated in CCS (Pension) Rules 1972 and the orders of the Department of Pension & PW shall continue to be applicable while calculating gratuity and cash payment in lieu of leave respectively.

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