The Union Cabinet has approved an increase in the dearness allowance (DA) for over one crore Central government employees and pensioners by four percentage points to 46% from the existing 42%, Union Minister Anurag Thakur said on October 18, 2023.
The Cabinet has also approved providing a 78-day salary as a bonus equivalent to non-gazetted Railway employees. As many as 11.07 lakh employees are likely to benefit by this action.
The dearness allowance for employees and pensioners is worked out on the basis of the latest Consumer Price Index for Industrial Workers (CPI-IW) brought out by the Labour Bureau every month.
Presently, over one crore central government employees and pensioners are getting a 42% dearness allowance.
The last revision in DA was done on March 24, 2023, and was effective from January 1, 2023.
The Centre had increased DA by four percentage points to 42% based on the percentage increase in the 12-month average of the All India Consumer Price Index for the period ending December 2022.
The DA is provided to employees and pensioners to compensate them for rising prices.
The cost of living increases over a period of time and is reflected through CPI-IW. The allowance is revised periodically twice a year.
