Centre Approves 2 Percent Increase in DA for Union Government Employees
On Friday, the Union Cabinet approved a 2% increase in Dearness Allowance (DA) for Central Government employees and Dearness Relief (DR) for pensioners, effective from January 1.
New Delhi: On Friday, the Union Cabinet approved a 2% increase in Dearness Allowance (DA) for Central Government employees and Dearness Relief (DR) for pensioners, effective from January 1.
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This raise will benefit approximately 48.66 lakh Central Government employees and 66.55 lakh pensioners, as per an official statement. The total cost for the exchequer due to this increase in both DA and DR will be around Rs 6,614.04 crore annually.
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Details of the DA and DR Revision
The revision of DA and DR is part of the two biannual hikes typically announced by the government—one in March and the other in October, ahead of Diwali. As inflation based on the consumer price index for industrial workers has eased this year, a 2% hike was implemented.
With this increase, DA has now risen to 55% of the basic pay. Prior to this, DA had been raised to 53% in October last year after a 3% increase.
Impact on Government Employees and Pensioners
The 2% increase will directly affect both current employees and pensioners, bringing financial relief to a large number of recipients. The government’s expenditure on the revised allowances is estimated to be Rs 6,614.04 crore per year.
Future of Wage and Allowance Revisions
The revision of DA and DR, though welcomed by employees, may be the last such adjustment before the 8th Pay Commission starts deliberating on the revision of wages and allowances. The government approved the formation of the 8th Pay Commission in January this year, with the formal constitution expected soon, including the appointment of the chairman and members.
Employee Forums Demand Merger of DA with Basic Pay
Employee forums have been pushing for the merger of DA and basic pay before the next pay commission report is implemented. Under the 5th Pay Commission, once DA exceeded 50%, it was merged with basic pay. However, this practice was discontinued under the 6th and 7th Pay Commissions.
