The Centre on Thursday increased the dearness allowance for government employees and the dearness relief for the pensioners by 3%. With the latest hike, the dearness allowance has been raised to 31%.
The decision was announced by Union Information and Broadcasting Minister Anurag Thakur at a Cabinet briefing in Delhi.
Dearness allowance is paid by the government to its employees to compensate for the increase in the cost of living due to inflation. It is revised twice a year, on January 1 and July 1. Dearness relief is the same allowance given to central government pensioners.
The new rate will be applicable from July 1 and will benefit over 47 lakh employees and 68.62 lakh pensioners. The decision is expected to cost the exchequer nearly Rs 9,488.40 crore per year.
In September, the Ministry of Finance had issued a memorandum saying that the retired Central government employees will receive cash payment and gratuity, NDTV reported.
In August, the government had increased the dearness allowance and dearness relief to 28% from 17%. It had also resumed payment of dearness allowance and dearness relief after putting three installments on hold in April 2020 due to the coronavirus pandemic.
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