Disparity Reduction Allowance 2021 by Finance Division Islamabad
Finance Division, Government of Pakistan has issued Notification No. F.No.14(1)R-3/2021-90 dated 03-03-2021 in connection with the Grant of Disparity Reduction Allowance 2021. Copy of the Notification got from Abdullah Khan.
Finance Division Notification
Hence the undersigned directed to convey the approval of the Federal Government for grant of Disparity Reduction Allowance @ 25% of the basic pay of Basic Pay Scales 2017 w.e.f. 1st March 2021. However, this allowance shall be admissible to civil employees in BPS 1-19 of the Federal Government, (including employees of the Federal Secretariat and attached departments). Hence who have never allowed additional allowance/allowances equal to or more than 100% of the basic pay (whether frozen or not) or performance allowance subject to the following conditions:
Furthermore, this Allowance will not be admissible to the employees of the organizations as mentioned in Annexure-I and those employees who are drawing additional allowance/allowances equal to or more than 100% of the basic pay(whether frozen or otherwise). Similarly, this allowance will freeze at the level drawn on 1st March 2021 and this Allowance will be subject to Income Tax. Likewise, this Allowance will be admissible during leave and the entire period of L.P.R. except during extraordinary leave. However, this Allowance will not treat as part of emoluments for the purpose of calculation of Pension/Gratuity and recovery of House Rent.
Similarly, this Allowance will not be admissible to the employees during the tenure of their posting/deputation abroad. Likewise, this Allowance will be admissible to the employees on their repatriation from posting/deputation abroad at the rate and amount which would have been admissible to them, had they not been posted abroad. Furthermore, This Allowance will be admissible during the period of suspension. Most noteworthy, the term “Basic Pay” will also include the amount of Personal Pay granted on account of the annual increment (s) beyond the maximum of the existing pay scales.
Disparity Reduction Allowance 2021 on Running Basic Pay
A structure of Unified Pay scales introduced in 1972 for all government servants. However, since 2009, disparities in salaries have occurred because employees of various government establishments allowed 100 percent to 300 percent of the basic pay as an allowance, in addition to the usual pay of the scale (list at Annexure-I).
The Government did not allow any increase in salaries of government servants in the budget for FY 2020-21. At the same time, the tax slabs revised for the salaried class. The tax revision, coupled with inflation, has had an adverse impact on government servants. whose take-home salaries were actually reduced even in nominal terms.
The matter reviewed in the meeting of the Secretaries’ Committee wherein it concluded that the salary structure. Hence of the Federal Secretariat has become a major impediment to attracting competent officers to work in Federal Ministries. Offices now prefer working for provincial governments, where Salaries have raised significantly. The Secretaries’ Committee was of the opinion that the present pay structure is not tenable. However, salaries of the Federal Secretariat require an upward revision in order to motivate and retain offices in the Federal Secretariat. Furthermore, there have been protracted and widespread protests by clerical staff against the disparity in salaries.