Cabinet approves 6% DA hike for central government employees


Nearly 50 lakh central government employees and 38 lakh pensioners can look forward to a 6% increase in their dearness allowance with the Union Cabinet approved the proposal on Tuesday. 

If the move is approved, the dearness allowance, which is linked to the consumer price index, will rise from 45% currently to 51%, triggering a further change in the allowance structure. For instance, payments like conveyance allowance and children's education allowance will also increase by 25%. 

Further, special compensatory allowance for those posted in remote areas such as the north-east and Jammu & Kashmir as central government employees in these areas are entitled to a Special Compensatory Allowance. Their special allowance goes up by 25% the moment the 50% trigger is breached. 

While the move will provide some relief to government employees and pensioners whose salaries and pension are usually revised once a decade, the increase will cost the exchequer Rs 1,500 crore annually. Households have been combating high inflation, which in recent weeks was led by rising fruit and vegetable prices. Wholesale price index-based inflation is expected to be around 8% at the end of March. 

Sources said the additional installment of DA will be released with effect from January this year. Typically, the increase takes place in two installments effective January 1 and July 1.

The Allowances which will be raised by 25% when DA reaches 50% CLICK HERE

CABINET APPROVED 6% DA TO CENTRAL GOVERNMENT EMPLOYEES.


 HIKE IN DEARNESS ALLOWANCE WILL BE 6% FROM JAN-2011 TO ALL CENTRAL GOVERNMENT EMPLOYEES

The Union Cabinet committee headed by Prime Minister today decided to increase the Dearness Allowance by 6% to Central Government employees.

Hike in the Dearness Allowance (DA) will be from 45% to 51% w.e.f.January 2011.

Release of additional installment of dearness allowance for this year to Central Government employees and Dearness Relief to Pensioners from Jan-2011 is to compensate the price hike   of essential commodities.

The revised rates of Dearness Allowance from 1.1.2011 to 28.2.2011 may be paid in cash as arrears and for the month of March may be disbursed with the salary.

The enhancement of Dearness Allowance is in accordance with the accepted formula, which is based on the recommendations of the 6th Central Pay Commission.

Government Order from Finance Department will be published very soon.

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