ISLAMAABD: Finance Ministry has given approval to the federal government’s grant of disparity reduction allowance of 25 percent of the basic pay of BS-2017 from March 01, 2021.
An office memorandum issued to this effect by the Finance Division reads that the allowance would be admissible to civil employees in basic pay scale from 1 to 19 of the federal government, (including employees of the federal secretariat and attached departments), who have never been allowed additional allowance /allowances equal to or more than 100 percent of the basic pay (whether frozen or not) or performance allowance.
The allowance would be subject to (a) this allowance will not be admissible to the employees of the organizations and those employees who are drawing additional allowance/allowances equal to or more than 100% of the basic pay (whether; (b) this allowance will be frozen at the level drawn on 1st March 2021; (c) This Allowance will be subject to income Tax’(d) the allowance will be admissible during leave and entire period except during extra ordinary leave; (e) the allowance will not be treated as part of emoluments for the purpose calculation of Pension/Gratuity and recovery of House Rent; (f) this allowance will not be admissible to the employees during the tenure of their posting/deputation abroad; (g) the 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; (h) this allowance will be admissible during the period of suspension; (i) the term “basic pay” will also include the amount of Personal Pay granted on account of annual increment beyond the maximum of the existing pay scales.
Finance Minister Dr Abudl Hafeez Shaikh has asked that all the Principal Accounting Officers (PAOs) and heads of the departments to ensure the compliance of this office memorandum in letter and spirit and any issues arising out of the implementation of disparity reduction allowance will be resolved by a committee notified by the Finance Division.
Copyright Business Recorder, 2021