At present, the total Dearness Allowance (DA) is 31 per cent, which may increase to 34 per cent. With the government increasing the DA by 3 per cent, it will become 34 per cent. It will be implemented from January 1, 2022 itself i.e. employees can get the allowance for the month of January and February along with arrears in the salary for the month of March.
What We Know So Far on DA Hike
As of now, central government employees are paid a Dearness Allowance of 31 per cent. The most recent hikes were given in July and October 2021, after a months-long freeze in the allowance due to the Covid-19 pandemic. The Union Cabinet in October had hiked dearness allowance and dearness relief by 3 per cent to 31 per cent to benefit 47.14 lakh Central Government employees and 68.62 lakh pensioners.
What is DA?
Dearness Allowance is a component of salary of government employees and pensioners. To cope up with the rising inflation, the central government revises DA and DR benefits twice every year – in January and July. DA varies from employee to employee based on whether they work in urban sector, semi-urban sector or the rural sector.
The government’s last move had benefitted early 48 lakh central government employees and 65 lakh pensioners across India when it hiked DA in October.
For Central Government Employees, DA is Calculated as Under:
Dearness Allowance percentage = ((Average of AICPI (Base Year 2001=100) for the past 12 months -115.76)/115.76) x 100. Here, AICPI stands for All-India Consumer Price Index.