Central government employees can get big gift, plan to increase dearness allowance

The central government can increase the dearness allowance (DA) by four percentage points from the existing 38 percent to 42 percent for its more than one crore employees and pensioners. A formula has been agreed upon for this purpose.

The central government can increase the dearness allowance (DA) by four percentage points from the existing 38 percent to 42 percent for its more than one crore employees and pensioners. A formula has been agreed upon for this purpose. Dearness Allowance for employees and pensioners is calculated on the basis of the Consumer Price Index for Industrial Workers (CPI-IW) released by the Labor Bureau every month. The Labor Bureau is part of the Ministry of Labour.

How much will be the increase?

Shiv Gopal Mishra, general secretary of the All India Railwaymen's Federation, said that the CPI-IW for December 2022 was released on January 31, 2023. He said that the increase in dearness allowance works out to 4.23 per cent. But the government does not take decimals into DA. In such a situation, there can be an increase of four percentage points in DA.

It can be increased from 38 percent to 42 percent. He told that the Expenditure Department of the Finance Ministry will make a proposal to increase DA.

In this, its effect on revenue will also be told. This proposal will be placed before the Union Cabinet for approval. The increase in dearness allowance will be applicable from January 1, 2023.

How much DA is being received now?

At present, more than one crore central government employees and pensioners are getting 38 per cent dearness allowance. The last change in DA was made on 28 September 2022, which was applicable from 1 July 2022. The central government had increased DA by four percentage points to 38 percent. This was done on the basis of the percentage increase in the 12-month average of the All India Consumer Price Index for the period ending June 2022.

Dearness allowance is given to the employees and pensioners to compensate for the rising prices. The cost of living increases over a period of time and is represented by the CPI-IW. The allowance is changed twice a year at different periods.

The real reason behind increasing the dearness allowance is the rate of inflation in the whole country. For this, consumer price index or retail inflation is considered as a measure. The effect of retail inflation in the market directly falls on the general public.