Increase in dearness allowance for central government employees likely in July

Amid rising inflation, 48 lakh central government employees and 67 lakh pensioners could benefit from increased dearness allowance (DA) and dearness relief (DR), which is expected to be announced in July . The DA is announced twice a year. It was first announced in January this year. According to reports, the government could take into account the increase in retail price inflation, estimated at 7.04% in May.

High Cost Allowance (DA) is granted to government employees and High Cost Assistance (DR) is received by retirees.

Recent hikes

Previously, the announcement regarding DA was made in March and September every year. However, there was a one-and-a-half-year gap after December 31, 2019, as no increases or changes were affected in the AD amount due to the COVID-19 pandemic.

The rise in the DA was restarted in July last year. Based on the recommendations of the 7th Wages Commission, the DA for all central government employees and the DR for pensioners was increased in July 2021 to 28% from 17%.

The next increase was in October 2021 and the DA was increased by 3% effective July 1, 2021. For this reason, all government employees began receiving DA at the rate of 31% from July 1, 2021. July 1, 2021.

After another 3% increase was announced on January 1, 2022, government employees received AD at a rate of 34%.

The upcoming hike

The Center is expected to increase DA by another 5% from July, according to media reports. While the All India Consumer Price Index (AICPI) jumped to 127.7 points in April, data from May and June will be closely watched as it will influence the rise in the AD. According to a Times Now report, if the numbers for these months remain above 127, the DA may be increased by 5%.

(Edited by : Sudarsanan Mani)

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