Srinagar: The Union Cabinet, headed by Prime Minister Narendra Modi, on Wednesday approved a hike in dearness allowance (DA) and dearness relief (DR) for central government employees and pensioners.
The decision will come into effect from July 1, 2021 and is expected to cost the government an additional Rs 34,400 crore. Dearness allowance and dearness relief rates have been hiked from the existing 17 per cent to 28 per cent.
Speculations are rife in J&K whether this hike will apply to government employees here, given the assumption that J&K is for now under direct central rule and that the erstwhile state is technically a union territory.
“As of now we don’t have any communication on this matter. Generally speaking, this is a hike specific to central government employees, and Union Territory government employees do not necessarily come under its purview”, a senior official of the Finance Department told Ziraat Times.
This is a major development for central government employees and pensioners who had been waiting for the restoration of DA and DR hikes under the Seventh Central Pay Commission (7th CPC) for months.
It may be noted that the Centre had frozen dearness allowance and dearness relief benefit for lakhs of central government employees and pensioners last year due to a shortfall in revenue collection after the Covid-19 pandemic devastated the economy.
It may be noted that a total of three DA hikes — 01.01.2020, 01.07.2020 and 01.01.2021 (4 per cent + 3 per cent + 4 per cent) — were pending before the cabinet finally took a decision on the approval today.
The Union Cabinet has approved an 11 per cent hike in DA as part of the three pending instalments. The existing DA of 17 per cent will rise to 28 per cent following the cabinet’s approval.
The resumption of DA hike is likely to benefit central government employees who will see a significant jump in their take-home salary. The provident fund and gratuity contribution will also increase as a result.
