These state government employees get Da Hike; Center may increase high cost allowance ahead of Holi


Madhya Pradesh on Saturday announced a hike in the dearness allowance (DA) from 11% to 31% for state government employees. The new rate of high cost allowance will come into effect from April. Previously, state government employees received DA at the rate of 20% of their base salary.

Two days before the budget session of Madhya Pradesh Assembly, Chief Minister Shivraj Singh Chouhan said, “Due to the coronavirus, we have not been able to increase the AD of state government employees. But now it will be increased to 31% and disbursed from April. According to officials, the state government’s decision will benefit nearly 7,000 employees.

Earlier, Congressman Jaivardhan Singh had said he would raise the demand to restore the old pension scheme in the next session.

According to reports, central government employees are also expected to receive a DA boost ahead of Holi. If the government announces a 3% DA increase, central government employees will receive the allowance at the rate of 34%. Currently, they receive an AD at 31% of their base salary. These employees can also obtain arrears from the previous two months with the March salary. An increase in Dearness Allowance will benefit more than a crore of central employees and retirees.

The dearness allowance, which is paid to compensate for the impact of inflation, constitutes an important part of the salary of central government employees.

Under the 7th Wages Commission (7th CPC), the central government reviews the DA twice a year – January and July. The DA of employees varies depending on the location of government employees whether they are located in the urban, semi-urban or rural sector.

Last year in October, despite the COVID pandemic, the government increased the dearness allowance for central government employees from 28% to 31%.

Under the 7th Wage Commission, the dearness allowance for central government employees is calculated as follows:

Percentage of dearness allowance = ((AICPI average (base year 2001=100) for last 12 months -115.76)/115.76) x 100. Here AICPI means All-India Consumer Price Index.


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