At least 50 lakh employees and around 65 lakh pensioners heaved a sigh of relief on July 14 when the Central government approved a hike in Dearness Allowance (DA) from 17 per cent to 28 per cent. The new rate will be effective from July 1, 2021.
The Union Cabinet has taken a decision to hike DA after it was put on hold last year amid the COVID-19 pandemic. The employees and pensioners have not received any DA arrears from January 1, 2020 to June 30, 2021. It was earlier mentioned that any hike in DA due to revision on July 1, 2021, will take into account the previous hikes as well.
“The Cabinet Committee chaired by the Hon’ble Prime Minister Shri Narendra Modi today has approved increase the Dearness Allowance to Central Government employees and Dearness Relief to pensioners with effect from 01.07.2021 to 28% representing an increase of 11% over the existing rate of 17% of the Basic Pay/Pension," the Centre said in a statement.
“In view of the unprecedented situation which arose due to the COVID-19 pandemic, three additional instalments of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners, which were due from 01.01.2020, 01.07.2020 and 01.01.2021, had been frozen," the Cabinet said in a statement.
With the 11 per cent increase in DA, DR benefits, the basic salary of July 1, 2021 will increase by 11 per cent. The same formula will apply to DR. According to the National Council of JCM's Shiv Gopal Mishra, the DA arrears of Class 1 employees will range from Rs 11,880 to Rs 37,554. He said that if the basic pay scale CPC agal level-13 i.e. 7th is calculated for the pay scale of Rs 1,23,100 to Rs 2,15,900 or level-14, the DA arrears of a Central Government employee will be between Rs 1,44,200 and Rs. 2,18,200.
