Eight Percent Rise in Central Government Dearness Allowance 2010

On Thursday, the Cabinet Committee on Economic Affairs (CCEA) has decided to increase ‘Dearness Allowance (DA)’ up to 8% for all the central government employees and pensioners in India from next month. Dearness allowance is a part of an employee’s salary. Along with house rent, this amount is also added to the basic salary of an employee. This DA is calculated as a percent of the basic salary. The overall dearness allowance is raised to 35%. ‘Dearness Allowance’ is also called as ‘Dearness Relief (DR)’. This hike in the ‘Dearness allowance’ will be effective form January 2009 and payable from March with employee’s salaries and pensioners.

For serving employees the increase in DA would be Rs. 4,100 crore for 14 months. And the DR for pensioners would be Rs. 1, 920 crore. Generally, the allowance to central staff will be revised twice a year, January 1st and July 1st and paid in salaries of March 1st and September 1st.

“The revised DA would be 22%, up 6% from the existing 16%. For the period from January 2009 to February 2010, the combined additional burden on exchequer owing to DA and DR would be Rs. 6,020 crore”, said by the Home Minister, P. Chidambaram.

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