Wednesday, December 6

Cabinet Approves 4% Increase in Dearness Allowance and Relief for Central Government Employees and Pensioners

In a significant move aimed at benefiting millions of Central Government employees and pensioners, the Union Cabinet, chaired by Prime Minister Shri Narendra Modi, recently gave its approval to release an additional installment of Dearness Allowance (DA) and Dearness Relief (DR) with effect from 01.07.2023. This decision comes as a welcome relief and aims to offset the impact of rising prices on the basic pay and pensions of these individuals. In this blog, we’ll explore the key details of this development and its implications.

Addressing Price Rise

The increase in DA and DR, which amounts to 4%, is a response to the ongoing challenge of inflation and its effects on the cost of living. This increment takes the existing rate of 42% of the Basic Pay/Pension and raises it to 46%. The decision to implement this increase is consistent with an established formula based on the recommendations of the 7th Central Pay Commission.

Impact on Beneficiaries

The impact of this decision is substantial and far-reaching. It not only reflects the government’s commitment to addressing the financial well-being of its employees and pensioners but also eases the economic burden on them. The combined financial impact on the exchequer, due to the increment in both Dearness Allowance and Dearness Relief, is projected to be Rs. 12,857 crore annually. This sizeable allocation underscores the government’s recognition of the importance of supporting its employees and retirees during times of economic stress.

The beneficiaries of this move are estimated to be around 48.67 lakh Central Government employees and an impressive 67.95 lakh pensioners. These individuals will see a positive change in their financial situations, and the increased allowances will help them manage their day-to-day expenses more effectively.

The Union Cabinet’s decision to release an additional instalment of Dearness Allowance and Dearness Relief serves as a testament to the government’s commitment to its employees and pensioners. It recognizes the challenges posed by rising prices and seeks to provide financial relief to those who serve or have served the nation. This move not only benefits millions of individuals but also reinforces the government’s dedication to ensuring the economic well-being of its citizens. As we move forward, such measures become essential in promoting financial stability and social well-being.

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