Payment of Dearness Allowance to Central Government employees – Revised Rates effective from 1.7.2012.

No.1(8)/2012-E-II(B)
Government of India
Ministry of Finance
Department of Expenditure
North Block, New Delhi
Dated: 28th September, 2012
OFFICE MEMORANDUM
Subject : Payment of Dearness Allowance to Central Government employees – Revised Rates effective from 1.7.2012.
The undersigned is directed to refer to this Ministry’s Office Memorandum No.1(1)/2012-E-II (B) dated 3rd April, 2012 on the subject mentioned above and to say that the President is pleased to decide that the Dearness Allowance payable to Central Government employees shall be enhanced from the existing rate of 65% to 72% with effect from 1st July, 2012.
2. The provisions contained in paras 3, 4 and 5 of this Ministry’s O.M. No.1(3)/2008-E-II(B) dated 29th August. 2008 shall continue to be applicable while regulating Dearness Allowance under these orders.
3. The additional installment of Dearness Allowance payable under these orders shall be paid in cash to all Central Government employees.
4. These orders shall also apply to the civilian employees paid from the Defence Services Estimates and the expenditure will be chargeable to the relevant head of the Defence Services Estimates. In regard to Armed Forces personnel and Railway employees, separate orders will be issued by the Ministry of Defence and Ministry of Railways, respectively.
5. In so far as the persons serving in the Indian Audit and Accounts Department are concerned, these orders issue in consultation with the Comptroller and Auditor General of India.

sd/-
(Anil Sharma)
Under Secretary to the Government of India

Cabinet meetings Scheduled on 21st Sept, postponed – Cabinet approval for Dearness Allowance increase likely to be Delayed

The meeting of the Union Cabinet, which was scheduled to consider a 7 per cent hike in dearness allowance to 80 lakh central government employees and pensioners, has been put off to next week.

“The Cabinet, CCEA (Cabinet Committee on Economic Affairs) and CCI (Cabinet Committee on Infrastructure) meetings scheduled for Friday, have been postponed,” an official announcement said.

Cabinet meetings usually take place on Thursdays, but they have been postponed apparently in view of the rapid political developments in the aftermath of the government’s decision to hike diesel prices and operationalise its earlier move to allow foreign direct investment (FDI) in multi- brand retail.

Increasing DA from 65 per cent to 72 per cent to provide relief to 50 lakh central government employees and 30 lakh pensioners was on the agenda of the meeting. It is now likely to be taken up next week.

Once approved, the hike in dearness allowance will be effective from July 1, 2012, and the employees would be entitled to arrears from that date.

The additional burden on exchequer on account of increase in DA would be around 5,000 crore for the eight-month period between July, 2012 and February, 2013. It will be Rs. 7,400 crore for the full financial year.

The government had last increased DA in March this year from 58 per cent to 65 per cent, which was effective from January 1, 2012.

The government periodically hikes the DA, which is linked to consumer price index for industrial workers.

The consumer price index (CPI) based on movement in retail prices, soared to 10.03 per cent in August, from 9.86 per cent in July.

Source: NDTV

Expected DA from 01January 2013 : AICPIN for the month of July 2012

All India Consumer Price Index Number for Industrial Workers (CPI-IW) on base 2001=100 for the month of July, 2012 increased by 4 points and stood at 212 (two hundred and twelve).

If the same trend continues for the remaining 5 months of the year (or even if it goes down by a point or  two in those months) then the expected increase in DA/DR from 01 Jan  2013 will be 7% taking the total DA/DR payable to 79%.

Release of 7% additional instalment of Dearness Allowance and Dearness Relief effective from 01 Jan 2012

Press Information Bureau
Government of India
Ministry of Finance
23-March-2012 19:37 IST

The Union Cabinet today gave its approval to release an additional instalment of Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners w.e.f. 1.1.2012 representing an increase of 7% over the existing rate of 58% of the Basic Pay/Pension, to compensate for price rise.

The increase is in accordance with the accepted formula, which is based on the recommendations of the 6th Central Pay Commission.

The combined impact on the exchequer on account of both dearness allowance and dearness relief would be of the order of Rs.7474.53 crore per annum and Rs.8720.32 crore in the financial year 2012-13 (i.e. for a period of 14 months from January, 2012 to February, 2013).