Central Government Employees DA Hike: Modi govt increases Dearness Allowance by 5 per cent

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Updated: Oct 09, 2019 4:52 PM

Central Government Employee Dearness Allowance (DA) increase: The Union Cabinet has decided to increase dearness allowance (DA) of central government employee by 5 per cent. The decision will benefit around 50 lakh central government employee.

DA hiked for central government employees.DA hiked for central government employees. Representational image: Pixabay

Central Government Employee Dearness Allowance (DA) increase: The Union Cabinet has decided to increase dearness allowance (DA) of central government employee by 5 per cent. The decision will benefit around 50 lakh central government employee. “DA for government employees increased by 5 %. Around 50 lakh central government employees and 62 lakh pensioners to be benefited,” Union Minister Prakash Javadekar said today.

The hike in DA is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.

In an official statement, the government today said, “The Union Cabinet Chaired by Prime Minister Narendra Modi today approved to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners w.e.f. 01.07.2019 representing an increase of 5% over the existing rate of 12% of the Basic pay/Pension, to compensate for price rise.”

According to the statement, the combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be Rs. 15909.35 crore per annum and Rs. 10606.20 crore in the financial year 2019-20 (for a period of 08 months from July, 2019 to February, 2020).

Around 49.93 lakh Central Government employees and 65.26 lakh pensioners will benefit from DA hike announced today. The additional financial implication on account of this increase in Dearness Allowance is estimated at Rs 8590.20 Crore per year; and Rs 5726.80 Crore in the current Financial Year of 2019-20 (for 8 months from July 2019 to February 2020).

What is DA?

The government pays Dearness Allowance/Dearness Relief to Central Government employees/pensioners to adjust the cost of living and to protect their basic pay/pension from erosion in the real value.

The Dear Allowance/Dearness Relief is revised twice a year from 1st January and 1st July.

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