Centre restores DA, raises it by 11% to 28%

NEW DELHI: In it’s first physical meeting since over a year, the Union Cabinet on Wednesday decided to restore Dearness Allowance (DA) and Dearness Relief (DR) for central government employees and pensioners from July 1 while increasing the rate of allowance to 28%.

This was also the Union Cabinet’s first announcement since the big reshuffle on July 7. Prime Minister Narendra Modi inducted 36 new faces into the council and promoted seven junior ministers to independent or Cabinet roles, in the biggest reshuffle in the council since 2014 when he first took over as the Prime Minister.

The increase in the DA and DR will impose an additional annual burden of ₹34,401 crore on the exchequer, Union minister of information and broadcasting Anurag Thakur told reporters after the Cabinet meeting that was chaired by Prime Minister Narendra Modi.

An official familiar with the matter said that the DA is allocated with reference to the inflation and increase prices, but the pandemic caused the government to freeze the allowance at 17%. “There is some relief that it has begun, but there is also a disappointment that arrears have not been allocated,” the official said.

In view of the Covid-19 pandemic, the Union government had frozen the three additional instalments of the DA and DR which were due from January 1, 2020, July 1, 2020, and January 1, 2021.

The move, Thakur said, will benefit about 4.83 million central employees and 6.52 million pensioners.

“The government has decided to increase DA to central government employees and DR to pensioners with effect from July 1, 2021 representing an increase of

AFP People stand next to a wreck after a bus plunged into a ravine following a bomb attack, which killed 13 people, including nine Chinese workers, in Kohistan district of Khyber Pakhtunkhwa province in Pakistan on Wednesday.