Is DA going to rise in July amid rising inflation? Here’s what we know
It is noteworthy that these developments come after the Finance Ministry increased DA and DR by 2% with effect from January 1 this year, raising the rate from 58% to 60% of basic pay.
New Delhi: A major update has emerged for millions of government employees and pensioners regarding Dearness Allowance (DA). The governments of Punjab, West Bengal, and Himachal Pradesh are considering increasing DA and clearing pending dues.
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What is Dearness Allowance (DA)?
DA is a component of the basic salary paid to central government employees, public sector workers, defense personnel, bank employees, and pensioners. It is revised periodically to offset the impact of inflation. DA is adjusted twice a year based on the All-India Consumer Price Index (AICPI). According to a report by Livemint, new announcements are usually made in March and October, while the revised rates are implemented from January and July. The objective is to reduce the burden of rising inflation on employees. DA is fully taxable and is subject to income tax according to the applicable tax slab.
An increase in DA and Dearness Relief (DR) benefits nearly 5 million central government employees and around 6.5 million retired central government pensioners, including defense pensioners.
States Considering DA Hikes
Punjab: On May 30, the Punjab government stated that it is considering the payment of pending DA and DR dues for all categories of state government employees and pensioners for the period from July 1, 2021, to March 31, 2024. The government also said that a sub-committee will discuss the payment of arrears based on revised salaries and pension benefits for the period from January 1, 2016, to June 30, 2021.
West Bengal: West Bengal Chief Minister Suvendu Adhikari has confirmed that an announcement regarding DA for government employees and pensioners will be made in the state's next budget on June 22. According to reports, he said that DA arrears for the period between 2016 and 2019 under the 7th State Pay Commission have already been paid to nearly 300,000 employees and pensioners. He had earlier assured that the state would comply with the Supreme Court's order regarding the payment of DA arrears.
Himachal Pradesh: Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu stated that the state government is reviewing DA and pending arrears for employees and pensioners. The Finance Department has been directed to withdraw its notice related to delayed salary payments and to release pending pension arrears. Sukhu described government employees as the backbone of the state and said that the government remains committed to safeguarding their welfare and interests.
When Have DA Announcements Been Made?
It is noteworthy that these developments come after the Finance Ministry increased DA and DR by 2% with effect from January 1 this year, raising the rate from 58% to 60% of basic pay. DA is reviewed twice a year based on the AICPI, with announcements generally made in March and October and implemented from January and July.
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