50% DA Milestone, from January 2024: How it transforms your Allowances
With the available Consumer Price Index for Industrial Workers (CPI-IW) indices as published by the Labour Bureau, it is seen that the Dearness Allowance for the central government employees will be at least 50%.
As a central government employee, you’re well aware of the significance of Dearness Allowance (DA) in your compensation structure. It’s a dynamic element that adjusts to the ever-evolving cost of living. The 7th Central Pay Commission had made provisions for hiking the allowances when the DA crosses 50%. However, what happens when DA hits the critical 50% milestone? How does this milestone impact your allowances and financial benefits as a central government employee?
It is expected that the Rate of DA will hit 50% Level from January 2024. When DA reaches 50%, certain allowances and salary components will be increased, as recommended by the 7th Pay Commission. These allowances include:
House Rent Allowance
Children Education Allowance
Special Allowance for Child Care
Hostel Subsidy
TA on Transfer (Transportation of Personal Effects)
Gratuity Ceiling
Dress Allowance
Mileage Allowance for Own Transport
Daily Allowance
House Rent Allowance (HRA)
The rates of HRA have been revised to 27%, 18%, and 9% of Basic Pay in X, Y, and Z cities when DA crosses 25%. The allowances have been revised according to the 7th CPC recommendation. No separate order is needed to revise this allowance, as the government has accepted the recommendation.
House Rent Allowance
The percentage of HRA shall be increased as per the following table when DA reaches 50%:
Type of City HRA from 1.1.2016 HRA when DA reached 25% HRA when DA reaches 50%
X 24% 27% 30%
Y 16% 18% 20%
Z 8% 9% 10%
Children Education Allowance
Children Education Allowance will be increased by 25% every time when DA reaches 50%.
Component Present Rate After DA Reaches 50%:
Children Education Allowance Rs 2,250 /- per month Rs 2812.5/- per month
Children Education Allowance to Divyang Child
Children Education Allowance to Divyang Child will be increased by 25% every time DA reaches 50%.
Component Present Rate After DA Reaches 50%
Children Education Allowance to Divyang Child Rs 4500 /- per month Rs 5625/- per month
Hostel Subsidy
Hostel Subsidy will be increased by 25% every time DA reaches 50%.
Component Present Rate After DA Reaches 50%
Hostel Subsidy Rs 6,750 /- per month Rs 8437.5/- per month
Special Allowance for Child Care for Women with Disabilities
Special Allowance for Child Care for Women with Disabilities will be increased by 25% every time DA reaches 50%.
Component Present Rate After DA Reaches 50%
Special Allowance for Child Care Rs 3000 /- per month Rs 3750/- per month
Gratuity Ceiling
Gratuity Ceiling will be increased by 25% whenever DA rises by 50%.
Maximum Gratuity Ceiling at Present Maximum Ceiling when DA Rises by 50%
Rs 20 Lakhs Rs 25 Lakhs
Dress Allowance
The Rates of Dress Allowance categories shall be increased by 25% whenever DA rises by 50%.
Category of Employee Present Rate After DA Reaches 50%
1 Special Protection Group (SPG) Operational 27,800 34750
2 Special Protection Group (SPG) Non – operational 21,225 26531
3 Officers of Army / IAF / Navy / CAPFS / CPOs RPF / RPSF / IPS / Coast Guard 20,000 25000
4 Executive Staff of Customs, Central Excise and Narcotics Department, etc. 10,000 12500
5 Other Categories of Staff 5,000 6250
6 Nurses 1800 /- per month 2250
TA on Transfer (Transportation of Personal Effects)
The following rates will be increased by 25% when DA reaches 50%.
Level By Train / Steamer By Road
12 and above 6000 Kg by goods train / 4 wheeler wagon / 1 double container Rs. 50 / – per km
6 to 11 6000 Kg by goods train / 4 wheeler wagon / 1 single container Rs. 50 / – per km
5 3000 kg Rs. 25 / – per km
4 and below 1500 kg Rs. 15 / – per km
Mileage Allowance for Own Transport
Mode of Transport Present Rate After DA Reaches 50%
For Journeys Performed in Own Car / Taxi Rs. 24 / – per km Rs. 30 / – per km
For Journeys Performed by Auto Rickshaw, etc. Rs. 12 / – per km Rs. 15 / – per km
Daily Allowance
The following Daily Allowance rates for reimbursement of various expenses shall be increased by 25% when DA rises by 50%.
For Pay Levels 14 and above:
Entitlement
Reimbursement for hotel accommodation/guest house of up to Rs. 27,500 / – per day.
Reimbursement of AC taxi charges as per actual expenditure commensurate with official engagements for travel within the city.
Reimbursement of food bills not exceeding Rs. 1,200 / – per day.
For Pay Levels 12 and 13:
Entitlement
Reimbursement for hotel accommodation/guest house of up to Rs. 4,500 / – per day.
Reimbursement of AC taxi charges of up to 50 km per day for travel within the city.
Reimbursement of food bills not exceeding Rs. 1,000 / – per day.
For Pay Levels 9 to 11:
Entitlement
Reimbursement for hotel accommodation/guest house of up to Rs. 2,250 / – per day.
Reimbursement of non-AC taxi charges of up to Rs. 2,338 / – per day for travel within the city.
Reimbursement of food bills not exceeding Rs. 900 / – per day.
For Pay Levels 6 to 8:
Entitlement
Reimbursement for hotel accommodation/guest house of up to Rs. 2,750 per day.
Reimbursement of non-AC taxi charges of up to Rs. 2,225 / – per day for travel within the city.
Reimbursement of food bills not exceeding Rs. 2,800 / – per day.
For Pay Levels 5 and below:
Entitlement
Reimbursement for hotel accommodation/guest house of up to Rs. 450 per day.
Reimbursement of non-AC taxi charges of up to Rs. 2,113 / – per day for travel within the city.
Reimbursement of food bills not exceeding Rs. 500 / – per day.
Reimbursement of Hotel Charges:
For levels 8 and below, the amount of claim (up to the ceiling) may be paid without the production of vouchers against self-certified claims only. The self-certified claim should clearly indicate the period of stay, name of dwelling, etc. Additionally, for stay in Class ‘X’ cities, the ceiling for all employees up to Level 8 would be Rs. 1,000 per day, but it will only be in the form of reimbursement upon the production of relevant vouchers. The ceiling for reimbursement of hotel charges will further rise by 25 per cent whenever DA increases by 50 per cent.
Reimbursement of Travelling Charges:
Similar to reimbursement of staying accommodation charges, for levels 8 and below, the claim (up to the ceiling) may be paid without the production of vouchers against self-certified claims only. The self-certified claim should indicate the period of travel, vehicle number, etc. The ceiling for levels 11 and below will further rise by 25 per cent whenever DA increases by 50 per cent. For journeys on foot, an allowance of Rs. 12/- per kilometre travelled on foot shall be payable additionally. This rate will further increase by 25 per cent whenever DA increases by 50 per cent.
Reimbursement of Food Charges:
There will be no separate reimbursement of food bills. Instead, the lump sum amount payable will be as per Table E(i) above and, depending on the length of absence from headquarters, would be regulated. Since the concept of reimbursement has been done away with, no vouchers will be required. This methodology is in line with that followed by Indian Railways at present (with suitable enhancement of rates). i.e. Lump sum amount payable. The lump sum amount will increase by 25 per cent whenever DA increases by 50 per cent.
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