The Central government announced a 3 percent hike in the Dearness Allowance and Dearness Relief of over one crore employees and pensioners, increasing it from the previous 50 percent to the revised rate of 53 percent. The move was meant to help them match up with the increasing prices. Prime Minister Narendra Modi approved The move at a cabinet meeting.
The increased rates will be effective July 1, 2024, and will provide substantial relief to central government employees ahead of the Diwali festival.
“The increase aligns with the accepted formula, which is based upon the recommendations of the 7th Central Pay Commission,”
The government said in a statement.
With this increase, the DA and DR are estimated to increase the government’s expenditure by Rs 9,448.35 crore annually. Further, it will benefit about 49.18 lakh central government employees and 64.89 lakh pensioners.
It is designed to compensate government employees, and DA plays a similar role in helping pensioners tackle the inflation factor. This allowance is revised every six months and is directly linked with the latest consumer price index for industrial workers.
