Srinagar, Jan 31: For central government employees, the last 12 months have been very tough. Not only did they have to deal with the coronavirus epidemic, they also had to tighten their belts as the government had ordered a freeze on the dearness allowance (DA) hike. That meant, even as inflation was jumping, government employees did not get the money they were supposed to deal with rising prices of goods, due to the freeze imposed to deal with Covid-19 impact on overall economy.
Now that the Budget 2021 has rolled around, expectations are that there would be some kind of announcement by the government. The greatest expectations would be for a salary hike and then for restoration of dearness allowance. The demand is to take it as high as 28% percent rather than just around or above 21% or even 25%. Will it happen? Well, Budget 2021 is set for February 1 and everyone should tune in to find out if there is any announcement or benefits for them.
Dearness Allowance:
Dearness Allowance (DA) of the central government employees was put on hold last year by the government to tackle the crisis emerging out of Covid 19 pandemic. Since then, the government employees have been waiting for the hike in DA. Central government employees were paid DA at 17 per cent instead of 21 percent to mitigate challenges of Covid 19. Now it is speculated that the government might take the DA hike to 28 per cent instead of restoring 21 per cent to help government employees, who faced financial hardships during the corona times.
Leave Travel Allowance:
There could be an increase in the Leave Travel Allowance of the Central government employees. LTA is part of an employee’s CTC (Cost to Company). Under the Income Tax Act, employees can claim exemption for traveling within the country. There is a buzz in the media that more LTA benefits could be announced in the budget 2021 to promote new tax regime. This is also as most of the central government employees could not avail this facility last year due to lockdown.
Gratuity:
Employees are eligible to receive gratuity, among other allowances, after a few years of service. Both Central and state government employees become eligible for gratuity. The maximum limit for types of gratuity remains to be Rs 20 lakh, since 2016. As the gratuity payout to employees will increase on introduction of Code on Wages, 2019 and the Code on Social Security, 2020, it is expected that the government would increase the upper limit of Rs 20 lakh to Rs 25 lakh. (Zee News English)
