In a significant move, the Union Cabinet has approved a 3 % DA hike for Central Government Employees and Dearness Relief (DR) for pensioners, aimed at offsetting the impact of rising prices. This decision, announced on Wednesday, October 16, 2024, comes just in time for the festive season of Deepavali.
Effective from July 1, the new DA will see an increase of 3% over the current rate of 50% of basic pay and pension, helping to mitigate the erosion of purchasing power due to inflation.
According to a government statement, “This increase adheres to the established formula based on the recommendations of the 7th Central Pay Commission.” The combined financial impact on the exchequer due to both DA and DR is estimated to be ₹9,448.35 crore annually.
This adjustment will benefit approximately 49.18 lakh Central government employees and 64.89 lakh pensioners. Notably, this marks the second revision of these allowances this year; the first adjustment was made on January 1.
The increment is determined based on the 12-month average of the All India Consumer Price Rise Index for Industrial Workers, as published by the Labour Bureau.
Union Minister Ashwini Vaishnaw expressed his congratulations to employees and pensioners, stating, “The enhanced DA and DR will boost the pay cheques of Central government employees and pensioners, just in time for Deepavali.”
