The Union Cabinet on Wednesday approved a three per cent increase in the dearness allowance (DA) for government employees as well as dearness relief to pensioners, with effect from January 2022. This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission. The dearness allowance has been increased from 31 per cent to 34 per cent. For the past one and half years, amid the Covid-19 pandemic, the government had put a hike in the three additional installments of dearness allowance, which were due on January 1, 2020; July 1, 2020; and January 1, 2021, on hold. In October last year, the cabinet had revised the dearness allowance of the central government employees by three per cent from 28 per cent to 31 per cent. In July last year, the dearness allowance was revised from 17 per cent to 28 per cent.
“The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, has given its approval to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners w.e.f. 01.01.2022 representing an increase of 3% over the existing rate of 31% of the Basic Pay/Pension, to compensate for the price rise,” the government said in a statement.
“The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be Rs.9,544.50 crore per annum. This will benefit about 47.68 lakh Central Government employees and 68.62 lakh pensioners,” it added.
