The Union Cabinet headed by Prime Minister Narendra Modi has approved an increase in the Dearness Allowance to Central Government employees and Dearness Relief to pensioners to 28 per cent. This hike represents an increase of 11 per cent over the existing rate of 17 per cent of the basic pay/pension.
- The increased DA and DR rates will be effective from July 1, 2021.
- It must be noted that both Dearness allowance and dearness relief was put on hold from January 2020, in the wake of the Covid-19 pandemic.
- As a result, the DA and DR instalments are due for four periods including January 1, 2020, July 1, 2020, January 1, 2021, and July 1, 2021.
- However, the rate of DA/DR for the period between January 2020 to June 2021 shall remain at 17%.