Dearness allowance for central government employees hiked by 3%
NEW DELHI: The Union Cabinet approved a 3% increase in dearness allowance (DA) for central government employees and a 3% increase in dearness relief (DR) for pensioners on Wednesday. As a result, DA for such employees currently stands at 34% of basic pay/pension, up from 31% previously. The increase will go into effect on January 1, 2022. In an official statement, the government stated, “This rise is in conformity with the established formula, which is based on the recommendations of the 7th Central Pay Commission.” The cumulative impact of both DA and DR on the exchequer will be Rs 9,544.50 crore per year.
“Approximately 47.68 lakh central government employees and 68.62 lakh pensioners will gain,” according to the press statement.
The Centre hiked DA from 28 percent to 31 percent in October of last year. After an almost year-long break, DA rates were raised from 17 percent to 28 percent in July 2021, marking the second increase in a year.
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Dearness Allowance (DA) hiked for central govt employees. Details here
The hike will also affect civilian employees who are paid by the Defense Services, according to hike news: The increase in Dearness Allowance has come as a relief to central government employees, who have been hit by rising gasoline and diesel prices, as well as growing inflation.
The Union Cabinet approved an increase in the proportion of Dearness Allowance and Dearness (DR) for central government employees and retirees from 31 percent to 54 percent on Wednesday.
This raise is in conformity with the established methodology, which is based on the 7th Central Pay Commission’s recommendations.
According to the government, the overall impact on the exchequer from Dearness Allowance and Dearness Relief will be around 29,544 crore each year. About 47.68 lakh central government employees and 68.62 lakh retirees will gain from this.
In the face of rising gasoline and fuel prices, as well as growing inflation, the increase in Dearness Allowance has come as a welcome respite to central government personnel.
The increase will also apply to civilian employees paid by the Defence Services, while separate orders will be issued by the Defence and Railways Ministries, respectively, for Armed Forces troops and Railway employees. The two allowances were raised by 3% to 31% by the Cabinet in October of last year. It went into effect on July 1, 2021. Prior to that, in July, the government restored the dearness allowance and dearness relief, as well as increasing the allowance rate from 17% to 28%.