Speculations are on the ripe that the Centre is likely to announce this year’s second hike in the Dearness Allowance (DA) for employees and Dearness Relief (DR) for pensioners in the first week of September 2024.
It is to be noted here the centre hikes the DA and DR twice a year under the 7th Pay Commission, with effect from January and July. It had last given a 4 per cent hike of both DA and DR in March 2024. With this, the central employees’ and pensioners’ DA and DR rose to 50 per cent of their basic pay.
Now it is suspected that the central government is likely to announce a 3 per cent hike of the DA and DR in the first week of the next month with effect from July 1, 2024. Once hiked by 3 per cent, the total dearness allowance of the central employees and Dearness Relief of the central pensioners will reach 53 per cent.
It was also speculated that the government will also release the 18-month arrears for DA and DR that were halted during the COVID-19 pandemic. However, Minister of State for Finance Pankaj Chaudhary has clarified government’s stand in this regard during the monsoon session of Parliament.
As reported by the news18.com, two MPs raised questions regarding the government’s decision on the DA arrears. They asked the concerned Minister ‘Whether the government is actively considering to release an 18-month dearness allowance/ relief of central government employees/ pensioners which were withheld during COVID outbreak’, Minister of State for Finance Pankaj Chaudhary, as quoted by news18.com replied, “No”.
“The decision to freeze three installments of Dearness Allowance {(DA)/Dearness Relief (DR) to Central Government employees/pensioners due from 01.01.2020, 01.07.2020 & 01.01.2021 was taken in the context of COVID-19, which caused economic disruption, to ease pressure on Government finances… As the adverse financial impact of the pandemic in 2020 and the financing of welfare measures taken by the Government had a fiscal spillover beyond FY 2020-21, arrears of DA/DR were not considered feasible,” the Minister added.