Dearness Allowance hiked by 4% for central employees, pensioners: Sources

mangaloretoday.com/NDTV

New Delhi, Sep 28, 2022: The Cabinet has approved a 4 per cent hike in Dearness Allowance (DA) for central government employees and pensioners, according to government sources.

 

The announcement will benefit about 47.68 lakh central government employees and 68.62 lakh pensioners and is also applicable for civilian employees and those employed in defence services.

Since the effective date for the latest dearness announcement hike is July 1, the staff would be paid the arrears with their latest salaries.

The central government revises dearness allowance and dearness relief on January 1 and July 1 every year, but this decision is usually announced in March and September.

Previously, in March, the Cabinet had approved the proposal to increase the dearness allowance (DA) for central government employees and dearness relief (DR) for pensioners by 3 per cent to 34 per cent of the basic pay from 31 per cent previously, effective January 1, 2022.

The government, at the time, paid employees three months in arrears.

The central government revises dearness allowance and dearness relief on January 1 and July 1 every year, but this decision is usually announced in March and September.

Any changes to the dearness allowance are made as per the accepted formula, which is based on the recommendations of the 7th central pay commission to compensate for the rise in prices.

With retail inflation, or consumer price inflation, elevated above the upper-end of the Reserve Bank of India’s target range of 2-6 per cent each month, the DA was hiked by 4 per cent to 38 per cent of basic pay.

All those who are paid based on the 7th Pay Commission will get an increase of ₹ 720 in DA on the basic salary of ₹ 18,000, and this increase will be ₹ 1,000 per month if the basic salary is 25,000.

Similarly, those who were getting ₹ 50,000 basic salary will now get a benefit of ₹ 2,000 per month, and those with a basic salary of ₹ 1,00,000 will get a benefit of ₹ 4,000 in total salary after the 4 per cent increase in dearness allowance.