The Union Finance Ministry has issued an order to implement the 28 per cent Dearness Allowance (DA) hike for Central Government Employees effective from July 1, 2021. The Ministry said that the 28 per cent DA hike order would not be applicable to Indian Railways employees and Armed Forces personnel. According to the Finance Ministry, separate orders for them would be issued by the respective ministries soon. Recently, the Modi government enhanced the DA payable to Central government employees from the existing 17 per cent to 28 per cent.
However, from 1 January 2020 to June 30, 2021, DA will remain at 17 percent. That means the Central government employees will not get any arrear towards the hiked DA, the Finance Ministry’s order said.
The Department of Expenditure (DoE) of the Ministry of Finance in an Office Memorandum dated July 20, 2021 said that in the DA hike, the basic salary will not include other salaries like special salary. However, an order to increase the DA of railway employees and armed forces personnel will be issued by the Ministry of Railways and Ministry of Defence, it said.
The order of DA hike issued for the Central Government employees will also be applicable to the civilian employees getting paid from the Defence Services Estimate, DoE said.
Due to COVID-19 pandemic, the Centre had not enhanced the DA of government employees last year. Now, it has been increased bringing relief to employees and pensioners. DA is a calculation on inflation and allowance is paid to government employees, public sector employees and pensioners. DA is periodically revised to mitigate the impact of inflation on the employees.