Date : 15.3.2017

Cabinet approves 2% DA hike from Jan 2017 for central government employees

The DA hike for central government employees and pensioners approved by the cabinet will be applicable from 1 January 2017

The dearness allowance is paid as a proportion of the basic pay of the central government employees. 

New Delhi: The Union cabinet on Wednesday approved a 2% hike in dearness allowance (DA ) and dearness relief for central government employees and pensioners from 1 January 2017.

Dearness allowance and dearness relief are provided to employees and pensioners to neutralise the impact of inflation on their earnings.

Earlier PTI had on 5th March reported that the labour unions were not happy with the proposed DA hike saying it would not be able to offset the real impact of price rise.

The average CPI-IW to be taken into account for raising DA is 4.95% from 1 January to 31 December, 2017. Since the government has already hiked the dearness allowance by 2% in October last year from 1 July 2016, it will now raise it further by 2%.

The dearness allowance is paid as proportion of the basic pay of the central government employees.

Earlier last year, the government hiked DA by 6% to 125% of basic pay. The DA was later merged into the basic pay following the implementation of the 7th Pay Commission award.

At present the central government employees and pensioners are entitled to 2% dearness allowance, which was effected from 1 July 2016.

PTI