New Delhi: Government employees should receive good news about their salary soon. According to rumours, the Centre may announce another increase in dearness allowance (DA) in July or August. Based on retail inflation data, the DA and DR are changed twice a year, in January and July.
This week will see the announcement of the April retail inflation rate. Inflation increased to 7% in March, up from 6.1 percent in February. It increased mostly owing to an increase in food items. Inflation in the food basket was 7.68 percent in March, up from 5.85 percent in February.
According to reports, the dearness allowance will likely be hiked by another four percent in July, bringing the total to 38 percent.
The Union Cabinet authorised a 3% rise in dearness allowance (DA) under the 7th Pay Commission in March, bringing the DA to 34% of basic income. This decision benefits nearly 50 lakh government employees and 65 lakh retirees.
“The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, has approved the release of an additional instalment of dearness allowance (DA) to central government employees and Dearness Relief (DR) to pensioners w.e.f. January 1, 2022, representing a 3% increase over the existing rate of 31% of basic pay/pension, to compensate for price rises,” the Prime Minister’s Office said in a statement.
The DA and DR were recently increased by the government. Since the freeze was lifted in July 2021, DA and DR have witnessed three rises and have nearly doubled.
Government employees receive dearness allowance, whereas pensioners receive dearness relief.
In light of the extraordinary scenario created by the COVID-19 pandemic, the federal government had set aside three installments of DA and DR for January 1, 2020, July 1, 2020, and January 1, 2021. In a written response to a question in the Rajya Sabha in August last year, Finance Minister Nirmala Sitharaman revealed that withholding DA and DR saved roughly Rs 34,402 crore.