Dearness Allowance For Central Govt Employees, Pensioners Hiked By 3% To 31%

Mumbai: Union Minister Anurag Thakur announced the Cabinet has approved a 3% hike in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners, effective from July 1, 2021. With this hike, central government employees will now get 31% DA from July.

This decision is a matter of happiness for more than 47 lakh employees of the Central Government. Earlier, DA and DR for central government employees and pensioners were increased from 17% to 28% respectively on July 14.

According to an Office Memorandum (OM) issued by the Department of Expenditure, Ministry of Finance, the DA hike announced for January 01, 2020 (4%) was from July 01, 2020 (3%) and January 01, 2021 (4%) to be included in the amended DA. So, the new DA rate applicable from July 01, 2021 for central government employees was 28%.

Announcing the decision of the cabinet, Union Minister Anurag Thakur said that DA and DR are fixed on the basis of an increase in the All India Consumer Price Index for industrial workers.

“The announcement will benefit 17.14 lakh central government employees and 18.62 lakh, central government pensioners. The decision will cost the exchequer Rs 9,488.74 crore annually,” Thakur said.

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Now, with 3% DA announced for July 1-December 31, 2021, the effective DA for central government employees and pensioners will be 31%. Employees and pensioners will get the 3% DA arrears for the month of July, August and September.

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