Saturday, 04 December 2021

Central government approves DA hike for Central govt employees

Central government approves DA hike for Central govt employees

The Union Cabinet on 21st October approved a three percent hike in the dearness allowance (DA) for Central governments employees, with effect from 1st July 2021.

In addition to dearness allowance (DA), the Centre government has also decided to raise the (DR) Dearness relief for pensioners employees by three percentage.

The decision will benefit gain over 48 lakhs central government employees and more than 65 lakhs pensioners employees.

The cost to be received by the exchequer due to the new DR and DA raise would be around Rs 9,488.70 crores per year.

With the latest increase in DA for the employees has been cumulatively rising to 31 percent.

Central government approves DA hike for Central govt employees 1unsplash image

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The last increase in dearness allowance (DA) and DR (DR) Dearness relief was announced on 14th July this year. The Centre had then hiked the basic allowance from 17 percent to 28 percent, in effect from 1st July 2021.

While the DA and DR usually raise by three percent, the Centre had decided to increase it by 11 percent, considering the deferred hikes due to the COVID-19 pandemic.

The installments of DA and DR for 1st January 2020, 1st July 2020, and 1st January 2021 were frozen as the government had moved to mop up resources because of the unprecedented health crisis.

The government pays DA to its employe to compensate for an increase in the cost of living due to inflation. It is revised twice a year, on 1st January and 1st July. DR is the same as allowance and is given to central government pensioners.

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