The wait is finally over. Centre on Wednesday approved 3 percent increase in Dearness Allowance (DA) and Dearness Relief (DR) for employees and pensioners.
The DA has been hiked from 31% to 34%. The hike will come into effect from January 1.
This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.
The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be about Rs 9,544 crore per annum, the government said in a statement. This will benefit about 47.68 lakh central government employees and 68.62 lakh pensioners.
The increase in Dearness Allowance has come as a relief for the central government employees amid the rising prices of petrol, diesel, and increasing inflation.
The hike will also apply to civilian employees paid by the Defence Services, while in respect of Armed Forces personnel and Railway employees, separate orders will be issued by the Defence and Railways Ministry, respectively.
In October last year, the Cabinet had hiked the two allowances by 3% to 31%. It was effective from July 1, 2021.
Before that in July, the government had restored the dearness allowance and dearness relief and increased the rate of allowance from 17 percent to 28 percent.
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