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Union Cabinet may discuss dearness allowance hike proposal: Sources

If this proposal is approved, then the DA of government employees will be increased to 31 percent.

New Delhi: Sources told NB on Thursday that the Union Cabinet is likely to discuss a proposal for a 3 per cent hike in Dearness Allowance (DA) of central government employees and pensioners. If this proposal is approved, then the DA of government employees will be increased to 31 percent.

Earlier in September, the Department of Expenditure under the Finance Ministry had issued a memorandum stating that retired central government employees would get cash payment and gratuity.

Earlier, the Center had approved to increase the DA and Dearness Relief (DR) to central government employees and pensioners from 17 per cent to 28 per cent.

This increase was effective from July 1, 2021 and benefitted about 48.34 lakh central government employees and 65.26 lakh pensioners.

Matters relating to payment of DA during the period January 1, 2020 to June 30, 2021 were also mentioned in the memorandum.

It had said that the rate of DA for the period “will remain the same at 17 per cent of the basic pay, it was increased to 28 per cent of the basic pay in additional installments arising on January 1, 2020 (4 per cent), July 1, 2020 (3 per cent) and January 1, 2021 (4 per cent) due from July 1, 2021.

“Approximate percentage of Dearness Allowance for employees retiring during the period and for calculation purpose shall be: 1st January, 2020 to 30th June, 2020: 21 per cent of basic pay; From 1st July, 2020 to 31st December, 2020 : 24 per cent of basic pay; from January 1, 2021 to May 30, 2021: 28 per cent of basic pay,” the memo further mentioned.

In view of the COVID-19 pandemic, the government had stopped three additional installments of DA and DR which were due from January 1, 2020, July 1, 2020 and January 1, 2021.

The Centre’s DA hike, effective from July 1, meant that employees would not get any arrears for not revising the DA for the previous period.

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