Our Prime Minister, Narendra Modi, announced the highest ever hike of 5 per cent in dearness allowance today. This increase is a gift to all the central government employees and pensioners. The new rate will be applied retrospectively from the month of July this year.
Information and Broadcasting Minister, Prakash Javadekar, briefed the media after the Union Cabinet meeting today and stated “The government has increased the DA from 12 per cent to 17 per cent. This is the highest ever 5 per cent increase in DA in one go by the Central government”.
The hike will cost Rs 16000 crore to the government treasury. Around 50 lakh central government employees and 65 lakh pensioners will be benefitted from the hike.
Dearness allowance is an allowance paid to the central government employees/pensioners to adjust the cost of living and to protect decline in their basic pay or pension’s real value.
Twice every year, i.e. 1 January and 1 July, the government revises the dearness allowance rate. In the month of January this year, the rate was revised from 9 per cent to 12 per cent. The government has also decided to increase the remuneration of Asha workers from Rs 1,000 to Rs 2,000.
All these hikes are based on the recommendations of the 7the pay commission.