Cabinet approves 4% hike in Dearness Allowance

Finally, the happy news for the central government employees is here. The Cabinet has approved a 4% hike in Dearness Allowance (DA) for central government employees and pensioners, according to government sources.

Read: Copy of the press release by the Press Information Bureau

The announcement will benefit about 47.68 lakh central government employees and 68.62 lakh pensioners and is also applicable for civilian employees and those employed in defence services. The 4% hike is applicable for those who are on the 7th Pay Commission scale. Employees in older scales will also receive a proportional hike.

The minimum hike will be Rs. 720/- for those who are in the 18000/- basic. 

Since the effective date for the latest dearness announcement hike is July 1, the staff would be paid the arrears with their latest salaries.

The grant of dearness relief (DR) to central government pensioners and family pensioners will also be applicable at the same revised rate, as it has been fixed for the employees, from July 1. The pension disbursing authorities, including the nationalized banks, will calculate the quantum of DR payable to each pensioner as per the individual case.

The revised rates will be applicable to central government pensioners, civilian central government pensioners/family pensioners, the armed forces pensioners, civilian pensioners paid out of the defence service, all India service pensioners, railway pensioners/family pensioners, and pensioners who are in receipt of provisional pension.

The central government revises dearness allowance and dearness relief on January 1 and July 1 every year, but this decision is usually announced in March and September.

Previously, in March, the Cabinet had approved the proposal to increase the dearness allowance (DA) for central government employees and dearness relief (DR) for pensioners by 3 per cent to 34 per cent of the basic pay from 31 per cent previously, effective January 1, 2022.

Now all eyes will be on the Dearness Allowance hike from January 2023. A further 4% hike can be expected in the DA from January 2023. Check out our calculator at 📈 Expected Dearness Allowance (DA) from January 2023 Calculator