Nagpur: The Union Cabinet has announced a 3 percent hike in Dearness Allowance (DA) for Central Government employees and pensioners in a festive delight just ahead of Diwali. This increase, raising the DA from 42 percent to 45 percent of the basic pay, brings a much-needed financial boost to millions of employees and retirees across the country.
The revised DA will take effect from July 1, 2024. This will ensure that employees and pensioners benefit from the increased allowance just in time for the festive season. This decision comes as a financial relief amidst rising inflation and the increasing cost of living.
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Friday 20 Dec. 2024
Dearness Allowance is an adjustment to salaries that helps employees keep up with inflation and rising living costs. It’s calculated based on the All India Consumer Price Index (AICPI). The last DA increase of 4% was announced in March this year.
“This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission. The combined impact on the exchequer on account of both DA and DR would be Rs 9,448.35 crore per annum,” the Finance Ministry said. This DA hike will benefit about 49.18 lakh Central Government employees and 64.89 lakh pensioners.
With the latest DA hike being announced in October, employees and pensioners will receive three months’ arrears when they receive the current month’s salary ahead of Diwali.
The Centre hikes DA twice a year, effective from January and July. However, the announcements are typically made around March and September. The January DA hike is usually announced around Holi, which falls in March, while the July hike is declared around Diwali, which usually takes place in October or November each year.
