News Update

Finance Ministry Issues Order To Implement Cabinet Decision On DA, DR Hike From July 1

• ByStartupStory     |    July 21, 2021

For Armed Forces personnel and Railways employees, separate orders regarding 28% DA will be issued by the respective ministries, the finance ministry said. The finance ministry on Tuesday has issued an order to implement the recent Cabinet decision to hike the dearness allowance of the government employees from 17 per cent to 28 per cent from July 1. Over 48 lakh central government employees and 65 lakh pensioners will benefit from the decision as the rate of the allowance was not revised owing to the pandemic. “These orders shall also apply to the civilian employees paid from the Defense Services Estimates,” it said, adding that for Armed Forces personnel and Railway employees, separate orders will be issued by the respective ministries.

 Last week, the Union Cabinet had approved an 11-percentage point hike in dearness allowance and dearness relief for central government employees and pensioners, following which the new DA rate is 28 percent. In India, the Dearness Allowance is a computation based on inflation and allowance granted to government employees, public sector employees, and pensioners. To reduce the impact of inflation on people, Dearness Allowance is computed as a percentage of an Indian citizen’s basic income. Dearness Relief is computed with reference to the basic pension/family pension of the pensioner. The Dearness Relief on the pension is revised and paid by the Pension Disbursing Agencies.

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