The DA i.e. dearness allowance of central government employees has been closed for 18 months, now the interest rates on the amount of General Provident Fund ie 'GPF' have not been increased. The employees coming under the purview of GPF had expected that this time the interest rates would be hiked. In the 'Sankalp' issued by the Department of Economic Affairs 'Budget Division' in the Ministry of Finance on July 5, it has been said that during the year 2021-22, the rate of interest to be paid on the total deposits of the subscribers of the General Provident Fund and other similar funds From July 1, 2021, to September 2021, it will be 7.1 percent. This rate will be applicable from July 1, 2021.
In the resolution issued by the Department of Economic Affairs on April 19, 2021, the interest rate on the amount of the General Provident Fund was fixed at 7.1 percent. This was for the first quarter of the financial year. The second wave of Corona had wreaked havoc in the country at that time. Since the central employees have also not received dearness allowance for 18 months, they expected the government to increase the rate of interest on the amount of 'GPF'. These rates are General Provident Fund (Central Services), Contributory Provident Fund (India), All India Services Provident Fund, State Railway Provident Fund (Defence Services), Indian Armament Department Provident Fund, Indian Ordnance Factory Workers Provident Fund, Indian Naval Dock Workers Provident Funds, Defense Services Officers Provident Fund and Armed Forces Personnel Provident Fund.
In GPF, at least 6% of the basic salary of the employees is deducted. Since the interest on this amount is higher than that of banks, many employees increase their share. In GPF, more salary is deducted so that the employees can use it at the time of their great need. Employees can withdraw 90% of their GPF amount. However, the terms and conditions keep changing regarding this. GPF amount is useful for children's education, marriage, building a house or buying a plot for it, taking a flat, repairing an ancestral house, and repaying the home loan. For this reason, employees deposit more amount in the GPF account than their basic salary.