DA hike up to 31 percent effective from July 1, separate orders will be issued for armed forces and railway employees

Dearness Allowance for Central Government employees has been increased from 28 percent to 31 percent of the basic pay with effect from July 1, 2021. This information has been given by the Ministry of Finance. The Department of Expenditure under the Ministry of Finance, in an office memorandum, said that 'Basic Pay' means the payments received as per the 7th Pay Commission and does not include any other special pay or allowances.

The Department of Expenditure said in an office memorandum issued on October 25, "...the dearness allowance payable to central government employees will be increased from the existing 28 percent to 31 percent of the basic pay with effect from July 1, 2021." It will also apply to salaried civilian employees, while in respect of armed forces personnel and railway employees, the Ministry of Defense and Railways will issue separate orders.

Dearness relief for pensioners increased by three percent

The Union Cabinet last week approved an increase in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners by three percent from the existing 28 percent. This decision will benefit about 47.14 lakh central government employees and 68.62 lakh pensioners. In July this year, the DA rate was increased from 17 percent to 28 percent. Now with an increase of three percent, the DA rate will be 31 percent. There will be a total impact of Rs 9,488.70 crore on the exchequer due to dear allowance and dearness relief.