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Central Government announces Dearness Allowance (DA) Hike

In our previous articles, we had covered the Dearness Allowance and its current status. The pandemic had taken a toll on both the Union Government as well as the citizens of the nation, All are going through tough times and the Central Government has decided to bring a smile to the faces of its employees and their extended families. Here is some good news. 

The 7th Central Pay Commission (7CPC) was constituted by the Union Government in February 2014. They are the principles and structure of emoluments of all central government civilian employees including defense forces in India. The emoluments mentioned in the 7th Pay Commission include allowances such as Travel Allowance (TA), Dearness Allowance (DA), House Rent Allowance (TA), medical reimbursement, etc. 

What is Dearness Allowance? How Dearness Allowance is calculated? 

The Dearness Allowance is a calculation on inflation and allowance paid to government employees, public sector employees, and pensioners in India, Bangladesh, and Pakistan. Dearness Allowance is calculated as a percentage of an Indian citizen’s basic salary to mitigate the impact of inflation on people. DA is being increased every 6 months. but the DA stopped for 3 half years from January 2020 due to Covid 19. Before that Dearness Allowance was 17% on Basic pay or pension as the case may be and that 17 % is only being given now also.

So that means for the last 3 times Dearness Allowance has not been increased. And according to sources, there is a possibility of a hike in Dearness Allowance which might be announced in the month of June. As per the 7th Central Pay Commission, a Central Government employee’s salary is divided into 3 parts which will include basic pay, allowance, and deduction. Currently, the Dearness Allowance is 17% and it is being said that it will be increased to 28% from 1st July 2021.

What is the latest news on Dearness Allowance? 

Since January 1, 2021, the announcement for Dearness Allowance (DA) hike is due which may get further delayed. According to the National Council of JCM (Joint Consultative Machinery) Staff Side, the Centre may announce a hike in DA for the Central government employees in June 2021, that is next month. As per officials of the National Council of JCM, hiking in the DA will be at least 4% of the basic salary of any Central government employee. The reason for a delay in the announcement of a hike in the DA is due to the sudden increase in cases of coronavirus and the discovery of the second wave of COVID- 19 which disturbed all the plans of the Central Government. Else the central government had decided the hike in DA announcement by April end or beginning of May which has now been postponed to the month of June being due from 1st January 2021.

What is the current status of Dearness Allowance?

Currently, the government has stopped the Dearness Allowance and DR benefits since January 2020 for the Central government employees since the outburst of the coronavirus as a measure to cut down unwanted costs. It is being said that the due from 1st January 2021 may be restored in June but it will come into effect only from 1st July 2021. A central government will get Dearness Allowance at a minimum of 4% on their basic salary based on calculating from July to December 2020. It has also been recommended by the respective department officials that you receive your Dearness Allowance in parts if they are unable to pay in three installments of Dearness Allowance to around 52 lakh central government employees at a single time. 


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