NEW DELHI: The Union Cabinet has approved a proposal to increase the Dearness Allowance (DA) for serving central government employees and Dearness Relief (DR) for pensioners by 3 percent.
Announced by Information and Broadcasting Minister Ashwini Vaishnaw on Wednesday, the hike raises the allowance from the existing rate of 60 percent of the basic pay or pension. The adjustment is designed to compensate for price rises and is effective retrospectively from July 1.
With this revision ahead of Diwali, more than 1.17 crore serving personnel and retired employees are set to receive arrears. According to an official release, the combined annual impact on the national exchequer due to the increased DA and DR will amount to Rs 10,016.10 crore.
The hike is implemented in accordance with the established formula based on the recommendations of the 7th Central Pay Commission.
"This regular revision of Dearness Allowance and Dearness Relief is a structured measure by the government to offset inflationary pressures for over 1.17 crore central government employees and pensioners. With an annual financial implication exceeding Rs 10,000 crore, this timely adjustment injected just ahead of the festive season directly boosts consumer liquidity, which in turn stimulates domestic consumption and retail demand across various sectors of the economy." — Dr. Shishir Gupta, Founder & CEO, StartupLanes
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