In a move to enhance the financial well-being of Central government employees and pensioners, the Union Government has approved a substantial 4% increase in both Dearness Allowance (DA) and Dearness Relief (DR), effective from July 1, 2023. This announcement was made by Union Minister Anurag Thakur.
As a result of this decision, the DA will see a rise from 42% to 46%, benefiting a significant number of individuals, including 48.67 lakh central government employees and 67.95 lakh pensioners.
The calculation of dearness allowance for employees and pensioners is based on the Consumer Price Index for Industrial Workers (CPI-IW), which is published monthly by the Labour Bureau. The release of this additional installment of DA and DR aligns with the recommendations of the 7th Central Pay Commission and serves as a measure to compensate for the mounting prices and inflation.
The collective financial impact, attributable to both Dearness Allowance and Dearness Relief, is projected to be Rs. 12,857 crore annually, directly benefiting around 48.67 lakh Central Government employees and 67.95 lakh pensioners.
Furthermore, the government has granted Diwali bonuses for Group C and non-gazetted Group B level officials, including paramilitary forces. The finance ministry has set a limit of ₹7,000 for non-productivity-linked bonuses (ad hoc bonuses) for central government employees for the year 2022–2023.
Under the purview of the finance ministry’s Department of Expenditure, a non-productivity linked bonus (ad-hoc bonus) equivalent to 30 days’ emoluments for the accounting year 2022-23 has been extended to central government employees in Group ‘C’ and all non-gazetted employees in Group ‘B’ who are not covered by any productivity-linked bonus scheme.