Cabinet approves 4% hike in dearness allowance for Central government employees

The Union Cabinet Wednesday raised the dearness allowance (DA) and dearness relief by 4 percentage points to 46 per cent to benefit 48.67 lakh central government employees along with 67.95 lakh pensioners ahead of the festive season and key Assembly polls.The new rate of the additional instalment of DA and dearness relief will be applicable from July 1, 2023, Information and Broadcasting Minister Anurag Thakur said at the Cabinet meeting.This increase is in accordance with the accepted formula, based on the recommendations of the 7th Central Pay Commission.The DA for employees and pensioners is worked out on the basis of the latest Consumer Price Index for Industrial Workers (CPI-IW) brought out every month by the Labour Bureau.The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be Rs.12,857 crore per annum. This will benefit about 48.67 lakh Central Government employees and 67.95 lakh pensioners.The Cabinet, chaired by Prime Minister Narendra Modi, took the decision in view of the three-month-long festive season, involving Navratra, Diwali, Chhat Puja, Gurupurab and Christmas, a report by Hindustan Times quoted an official said requesting anonymity.The decision to raise DA, a routine, comes week after the Election Commission of India (ECI) announced the assembly polls in five states -- Rajasthan, Madhya Pradesh, Chhattisgarh, Mizoram, Telangana – starting from November 7.With inputs from agencies