New Delhi: The finance ministry on Tuesday has issued an order to implement the recent Cabinet decision to hike the dearness allowance of the government employees from 28 per cent to 31 per cent from July 1.
Over 48 lakh central government employees will benefit from the decision. “These orders shall also apply to the civilian employees paid from the Defence Services Estimates,” it said, adding that for Armed Forces personnel and Railway employees, separate orders will be issued by the respective ministries.
The Union Cabinet had approved an three percentage point hike in dearness allowance and dearness relief for central government employees and pensioners on Thursday, following which the new DA rate is 31 per cet.
The allowance rate is generally revised twice a year in January and July.
Earlier this year, the government had hiked the DA for central government employees by 11 percentage points from 17% to 28%. The increase reflects the additional instalments arising on 1 January, 2020, 1 July 2021 and 1 January 2021.
The DA and DR instalments are due for four periods namely January 1, 2020, July 1, 2020, January 1, 2021 and July 1, 2021.
The government had frozen all such hikes last year as coronavirus had dented its revenue.
The DA hike for central government employees is likely to cost the government about ₹34,400 crore annually.