DA Hike: Cabinet Announcement Expected Today, Days Before Diwali

The central government is expected to announce a hike in dearness allowance for its employees and pensioners ahead of Diwali on Wednesday. The decision was taken at the Cabinet meeting concluded on Wednesday, people in the know told NDTV.

Dearness allowance, or DA, is paid to government employees, and dearness relief to pensioners to offset the impact of inflation.

This dearness allowance hike comes just during the festive season, and will likely benefit nearly one crore beneficiaries.

The central government had last revised DA paid to employees in March by 4%. This took the overall DA hike from 46% to 50% of the basic pay.

Anticipation over an increase in dearness allowance has been building up for over a week now after the news first broke on Oct. 9 about a potential hike in dearness allowance being taken up in the Cabinet meeting last week.

Ahead of the meeting, employee unions had predicted at least a 3% increase in both the dearness allowance for government employees and the dearness relief for pensioners.

The biannual revision of dearness allowance and dearness relief impacts approximately one crore employees and pensioners, serving to mitigate the effects of inflation.

All public sector employers determine basic salaries for their employees based on established pay scales. Various additional components are then calculated relative to the basic salary and added to it to arrive at the final take-home pay. One of these key components is the dearness allowance.

Key decisions regarding the Minimum Support Price for wheat and other Rabi crops are also on the agenda for the Cabinet meeting today, the aforementioned people said. This move aims to bolster the agricultural sector ahead of the upcoming harvest season, providing farmers with much-needed financial stability.

Major announcements from the meeting will be announced at 3:00 p.m. today.