Good News for Government Employees and Pensioners – Govt Likely To Hike Dearness Allowance by 3%.

Yes! You heard it right. The government once again came up with the proposal to hike the Dearness Allowance (DA) for government employees and pensioners.

Full Detail – Hike in Dearness allowance for government employees and pensioners

Over one crore government employees and pensioners will receive a 3% hike in their Dearness Allowances, charting the total percentage of Dearness Allowances from 42% to 45%, highlighted in the latest Consumer Price Index for Industrial Workers (CPI-IW).

The Central Government provides Dearness Allowance (DA) to government employees as part of compensation against inflation or rising prices to maintain the purchasing power of the employees’ salaries and to ensure that their standard of living remains unaffected by the rising cost of living.

The latest hike in DA will run from 1st August 2023 after the finance ministry’s expenditure department drafts a proposal to the Union Cabinet for approval.

How much hike government is planning to give ???

The government does not consider giving any weightage to decimal calculations, and therefore, despite demands for a 4% hike, the government and parties have settled for a percentage hike of around 3%.

Dearness Allowance is adapted periodically, twice a year. The last DA hike revision took place on March 24, 2023, and was effective from January 1, 2023.

The Centre hiked 4% of DA from 38% to 42%, which cost 12,815 crores and benefited around 47.58 lakh employees and around 69.76 lakh pensioners. The dearness allowance for employees and pensioners is calculated by factoring in the latest Consumer Price Index for Industrial Workers (CPI-IW) brought out by the Labour Bureau every month.

When it will be announced ??

The Centre could announce the DA hike by the end of  September Month.