It is very important for central employees that 18 months dues of Dearness Allowance – DA are going to come to their account. Along with this, an increase of 25% in allowances has also been announced. This step will not only strengthen the economic condition of the employees, but will also increase their purchasing power.
The payment of DA and DR (Dearness Relief) was stopped from January 2020 to June 2021 during the Korona epidemic. Millions of government employees and pensioners are expected to get relief from this decision. Come, let’s understand this subject in detail.
What is dearness allowance (DA) and Dr?
Dearness allowance (DA) is a type of financial benefit, which the central government gives to its employees and pensioners. This is given to reduce the effects of inflation. DR (Dearness Relief) is a similar benefit for pensioners. DA and Dr are calculated on the basis of All India Consumer Price Index (AICPI).
Description of increase in 18 months DA outstanding and allowances
The table below has given a brief observation of this scheme:
| aspect | Description |
| DA/DR period | January 2020 – June 2021 |
| outstanding amount | 18 months da da |
| Current da rate | 53% |
| Possible new rate | 56% |
| Increase in allowances | 25% |
| Beneficiary | Central employee and pensioner |
| Declaration date | February 2025 |
DA/DR outstanding: What does employees mean?
- Economic relief: The employees will get great financial help from getting 18 months dues.
- Spending ability: This will increase their purchasing power, which will increase demand in the market.
- Benefits to pensioners: The amount of DR will directly increase the monthly pension of pensioners.
- Relief from inflation: This step will provide relief amid rising inflation.
How is the dearness allowance fixed?
DA is calculated based on a certain formula:
Yes = (12 aicpi -) × 100
And,
12 AICPI-
) × 100
- Currently the AICPI index has reached 144.5 by October 2024.
- Based on the data of November and December 2024, this rate can reach 56% in January 2025.
25% increase in allowances: What will be the effect?
The government has also announced a 25% increase in various allowances. This will directly affect the following areas:
- Travel allowance: Relief in travel expenses.
- Medical Allowance: Expenditure on health services will be reduced.
- House Rent Allowance (HRA): Benefits to rental employees.
Possible benefits for central employees and pensioners
- Salary hike: Monthly salary will increase with the implementation of new DA rate.
- Pension hike: Pensioners will get more monthly amount due to increase DR.
- Consumer spending: Due to higher income, consumer expenses will increase, which will strengthen the economy.
DA/Dr Outstanding: What does reality say?
Although employees and pensioners have high expectations from this announcement, the Finance Ministry had earlier clarified that the amount of DA/DR stopped during the epidemic would not be released. The government described it as a step taken to reduce financial pressure.
conclusion
Increase in dearness allowance and other allowances can be a positive step for central government employees and pensioners. However, the official announcement on the subject by the government is yet to be done.
Disclaimer:
This article is based on various media reports and estimates. A final decision on this subject is yet to be taken by the government. Readers are advised to wait for official announcements.
