To know the net CTC, the basic salary has to be multiplied by the fitment factor as it is currently 2.57. After this, the allowance found in it is added.
According to the rules of the Seventh Pay Commission, the salary of a central government employee is divided into three parts. Which includes his basic pay allowance and deduction. Net CTC is a central government employee who is the 7th CPC fitment factor and the sum of basic pay multiplied by all allowances.
Right now the dearness allowance is 17 percent, which was being talked about to be increased to 28 percent from July 1, 2021. The calculation of dearness allowance is made on the basis of basic salary. Travel allowance also increases with Dearness Allowance. In this case, TA will also increase as DA increases. Due to increase in DA and TA, the share of allowance for central employees will increase and their net CTC will increase.
Anurag Thakur had said in a written reply in the Rajya Sabha that from July 1, 2021, it is being decided to release future installments of dearness allowance. This will increase the salary of central government employees.
The government has also made it clear that no arrears will be received from January 1, 2020 to June 30, 2021. Meaning these employees will not get the benefit of arrears. From July 1, the benefit of increasing dearness allowance will be given to 52 lakh central employees and more than 60 lakh pensioners.
Earlier, Minister of State for Finance Anurag Thakur had said in Parliament recently that from 1 July 2021, dearness allowance for central employees and pensioners will be updated. Currently, it has not been extended from 1 January 2020.
A new statement has been issued by the government regarding dearness allowance. It has been made clear from the government that the dearness allowance of the central government employees will not be increased till 1 July 2021. They will get the benefit of dearness allowance at the old rates only. At present, central employees and pensioners are getting 17 percent dearness allowance.
