New Delhi:

After the meeting of the Union Cabinet, the central government gave its employees a big gift before Diwali. The government has announced a 3 percent increase in the dearness allowance (DA) of central employees, which will now increase their total dearness allowance from 50% to 53%.

Union Information and Broadcasting Minister Ashwini Vaishnav gave this information about the decisions taken in the cabinet meeting chaired by Prime Minister Narendra Modi. He informed that the DA and DR hike will be effective from July 1, 2024. Earlier in March, the government had increased DA and DR by four percentage points to 50 percent from January 1, 2024.

The minister said that the DA hike is based on the 12-month average of the All India Consumer Price Index-Industrial Workers. He said that the increase in DA and DR will put an additional burden of Rs 9,448 crore on the government exchequer.

Dearness Allowance (DA) is a type of financial assistance given by the government to employees, which is given to keep pace with inflation and the rising cost of living. It is calculated based on the All India Consumer Price Index (AICPI). Every year the government increases the dearness allowance of its employees twice, in January and July. Its formal announcement is usually made in March and October.

While the central government has increased DA by 3% for its employees, many state governments are also giving gifts to their employees in the form of bonuses and increases in dearness allowance before Diwali. The Himachal Pradesh government recently announced a 4% increase, which has also given great relief to its employees.

Dearness allowance is calculated on the basis of the All India Consumer Price Index. There is a revision every 6 months regarding DA. Dearness relief is given to retired central government employees. After the increase in DA, the adjustment is effective in January and July.

This will be the benefit. DA is announced in March and September. The announcement of an increase in DA in January goes till March. Similarly, the announcement of an increase in DA in July goes till Diwali. After the three percent DA increase, the basic salary of an entry-level government employee is expected to increase by Rs 540 on a monthly basis.

This decision of the government will provide relief to about one crore central employees and pensioners. Employees are also expected to get arrears for July, August and September. An increase in DA was expected after the Union Cabinet meeting on October 9. However, central employees and pensioners had to wait a little longer for this amendment.

In my understanding, this decision of the government will definitely provide relief to central employees from the impact of inflation on their salary. Along with this, this step is also a positive sign for those employees who have been waiting for this increase for a long time. Overall, this announcement of the Union Cabinet has proved to be a big gift for lakhs of employees on the occasion of Diwali.

Article written by and Editorial credit: State Bureau Chief Himanshu Nauriyal.