The Union cabinet approved a four per cent hike in Dearness Allowance (DA) and Dearness Relief (DR) for central government employees and pensioners on Wednesday.
India Today quoted sources as saying on Tuesday that the Centre was all set to approve the hike in DA after the cabinet meeting today.
The DA for central government employees will now increase from the existing 42 per cent to stand at 46 per cent following the decision of the Centre.
Union minister Anurag Thakur said that the release of the additional installment of dearness allowance and dearness relief will be applicable from July 1, 2023.
He said, “Dearness Allowance for Central govt employees and Dearness Relief for pensioners increased by 4 per cent. The DA hike will be implemented from July 1, 2023.”
The four per cent DA and DR hike would cost the government around Rs 12,857 crore annually, said Thakur.
The long-awaited decision has come during the ongoing festive season and it is being seen as a ‘Diwali gift’ for lakhs of central government employees and pensioners. The decision is thought to have a positive impact on 48.67 lakh central government employees and a further 67.95 lakh pensioners.
This is because all central government employees are now set to get enhanced salaries from the month of November which will come with the added arrears for the period between July and October.
Meanwhile, those with a minimum basic salary of Rs 18,000, with a current 42 per cent DA get an additional amount of Rs 7,560 every month. This will rise to Rs 8,280 at 46 per cent DA. Additionally, those individuals with maximum basic salary of Rs 56,900, who currently receive an additional income of Rs 23,898 monthly, will now earn an additional Rs 26,174 per month at 46 per cent DA.
It may be noted that DA acts as a cost-of-living adjustment allowance given to the government’s committed workforce, while DR serves central government pensioners, offering them the means to manage the rising cost of living. The government revises the rates of DA and DR every six months.
