Centre is likely to increase the dearness allowance (DA) of its employees by another 5 percent from July onwards.
Media reports said nearly 48 lakh central government employees and 67 lakh pensioners will be benefitted from the new hike.
Last time, DA was increased by 3 percent to 34 percent for government employees with effect from January 1, 2022.
With inflation in the country soaring at record levels, the DA hike will bring some relief for the government employees. According to media reports, given the All-India Consumer Price Index (AICPI) at around 127 points, the DA hike is likely to be around five percent. The DA is revised two times a year — January and July.
The retail inflation, based on CPI, in April, stood at an eight-year high of 7.79 percent.
In July 2021, the Centre hiked DA and dearness relief (DR) for the central government employees and pensioners, respectively, to 28 percent from 17 percent after a long pause. DA is given to government employees, while dearness relief (DR) is for pensioners.
In October 2021, the central government employees received a 3 percent jump in dearness allowance. Then, the DA for them rose to 31 percent, effective July 2021.
The AICPI in January stood at 125.1 points, which dropped to 125 in February. However, in March, the Index again jumped one point to 126 points. The AICPI in April jumped to 127.7 points. Data for May and June will now be closely watched. If the figures in those months remain above 127, the DA may be hiked by five percent, according to media reports.
