Big benefit for central employees! Dearness allowance likely to increase to 42% next year, check details

The central government gives Dearness allowance (DA) to the employees and dearness relief (DR) to the pensioners for their services. It gives the DA based on the data of the All India Consumer Price Index (AICPI). Currently, the central government employees are getting 38 percent dearness allowance from July 2022.

According to media reports, the government may increase the DA of the employees by 4 percent next year as the next amendment in dearness allowance is expected to happen in January 2023. It is because the inflation figures between July and September have been done and at the end of November, and the inflation rate of October is likely to be known soon.

If the dearness allowance is increased by 4 per cent in January next year, the DA will increase to 42 percent.

It is to be noted here that the Union government had raised the DA of government employees by 7 percent in 2022. First, the government increased the DA by 3 percent from 31 per cent to 34 per cent in January 2022. Then there was a 4 percent hike in the DA in July. After the 4 percent hike, the DA rose to 38 percent.

According to media reports, the government’s decision to increase the DA benefitted over 50 lakh central employees and 62 lakh pensioners.

The central government revises the dearness allowance of its employees every six months. However, it has added a condition under the 7th Pay Commission. According to the condition under the 7th Pay Commission, the dearness allowance of the employees will be merged with their basic salary if it crosses 50 per cent. When an employee’s dearness allowance becomes 50 percent, the money that he/she will be getting as DA will be added to his/her basic salary and only the money will be given as a revised salary allowance.