After the recent cabinet nod on Dearness Allowance, DA has now become 34% of the basic income. The DA is proportional to the base wage. As a result, a raise in DA will also raise central government employees’ monthly provident fund (PF)
The gratuity amounts of the employees will also be increased due to the hike in DA.
The hike in dearness allowance has also cleared the path for hike in Travel/Transport Allowance and City Allowance of the employees.
The Union Cabinet chaired by Prime Minister Narendra Modi had on March 30, 2022 given its approval to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners w.e.f. 01.01.2022 representing an increase of 3% over the existing rate of 31% of the Basic Pay/Pension, to compensate for price rise.