DA Hike News 2022: Dearness Allowance for central government employees hiked by 3 percent-Who will benefit?

DA Hike for Central Government Employees: The Union Cabinet on March 30, 2021 approved a 3 percent hike in dearness allowance for central government employees and dearness relief to pensioners.

The dearness allowance for central government employees will be hiked from the existing 31 percent to 34 percent of basic pay. 

The DA hike will come into effect from January 1, 2022. The DA increase has been approved based on the recommendations of the 7th Central Pay Commission.

DA Hike Impact

The combined impact of the increase in dearness allowance for central government employees and dearness relief to pensioners on the exchequer will be Rs 9,544.50 crore per annum.

Who will benefit from the Dearness Allowance hike?

The Dearness Allowance hike will benefit about 47.68 lakh central government employees and 68.62 lakh pensioners.

What is Dearness Allowance?

Dearness Allowance is the cost-of-living adjustment allowance that the government pays to its employees?

How is Dearness Allowance calculated?

Dearness Allowance is calculated by multiplying the current rate of Dearness allowance with your basic salary. 

For eg: If the existing DA rate is 12% and if your basic salary is Rs. 49000. Then DA would be 49000x12/ 100.

What is Dearness Relief?

Dearness Relief is the same as DA and is given to central government pensioners. It is a part of the pension received by a pensioner. 

Who are eligible for DA?

Only public sector employees are eligible for Dearness Allowance and Dearness Relief.

What is DA for govt employees?

The current DA rate for central government employees has been increased by 3 percent to 34 percent. It will be effective from January 1, 2022. 

Dearness Allowance: Background

The central government had increased DA by 3 percent from 28 percent to 31 percent of basic pay and pension in October 2021 as a Diwali gift to the central government employees. This was the second raise in DA after DA rates were increased from 17 percent to 28 percent after a year-long gap in July 2021. 

The centre had frozen three additional installments of the Dearness Allowance and Dearness Relief that were due on January 1, 2020, July 1, 2020 and January 1, 2021. 

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