Dearness Allowance hiked to 53%: Key points about DR increase for retired govt officials

Ahead of Diwali 2024, the Union Cabinet has approved a 3% increase in Dearness Allowance (DA) for Central government employees and Dearness Relief (DR) for pensioners, effective July 1, 2024. This hike, aimed at compensating for the rise in prices, will adjust the current rate of 50% of basic pay/pension to help combat the impact of inflation on the real value of wages. 

Dearness Allowance (DA) is a portion of an employee's base salary designed to offset the impact of inflation on their day-to-day expenditures. This allowance is periodically reviewed, usually every six months, to align with changes in the cost of living index. DA is applicable to current central government employees, while DR is provided to retired individuals.

Here are 9 key points regarding the Dearness Relief increase from July 1, 2024

A government office memorandum issued on October 30, 2024, outlined important details about the Dearness Relief hike set to take effect on July 1, 2024. Below are 9 crucial points to be aware of regarding this update.

i) Civilian Central Government Pensioners/Family Pensioners including Central Govt. absorbee pensioners in PSU/Autonomous Bodies in respect of whom orders have been issued vide this Department's OM No. 4134/2002-P&PW(D)Vol.11 dated 23.06.2017 for restoration of full pension after expiry or commutation period of 15 years.
(ii) The Armed Forces Pensioners/Family Pensioners and Civilian Pensioners/Family Pensioners paid out of the Defence Service Estimates.
(iii) All India Service Pensioners/Family Pensioners.
(iv) Railway Pensioners/Family Pensioners.
(v) Pensioners who arc in receipt of provisional pension
(vi) The Burma Civilian Pensioners/Family Pensioners and Pensioners/families of displaced Government Pensioners from Burma/ Pakistan, in respect of whom orders have been issued vide this Department's OM No. 23/3/2008-P&PW(B) dated 11.09.2017.

2. The payment of Dearness Relief involving a fraction of a rupee shall be rounded off to the next higher rupee.

3. The payment of arrears of Dearness Relief shall not be made before the date of disbursement of pension/family pension of October, 2024.

4. Other provisions governing grant of DR in respect of employed family pensioners and re- employed Central Government Pensioners will be regulated in accordance with the provisions contained in Rule 52 of' CCS (Pension) Rules, 2021 and this Department's' OM No. 45/73/97- P&PW (G) dated 2.7.1999 as amended from time to time. 

5. The provisions relating to regulation of DR where a pensioner is in receipt of more than one pension will remain unchanged.

6. In the case of retired Judges of the Supreme Court and High Courts, necessary orders will be issued by the Department of Justice separately.

7. It will be the responsibility of the pension disbursing authorities, including the nationalized banks, etc. to calculate the quantum of DR payable in each individual case.

8. The offices of Accountant General and authorised Pension Disbursing Banks are requested to arrange payment of Dearness Relief to Pensioners/Family Pensioners on the basis of these instructions without waiting for any further instructions from the Comptroller and Auditor General of India and the Reserve Bank of India in view of letter No. 528- TA, II/34-80-11 dated 23/04/1981 of the Comptroller and Auditor General of India addressed to all Accountant Generals and Reserve Bank of India Circular No. GANB No. 2958/GA-64 (ii) (CGI,)/81 dated the 21 st May, 1981 addressed to State Bank of India and its subsidiaries and all Nationalised Banks.

9. In so far as the pensioners/family pensioners of Indian Audit and Accounts Department are concerned, these orders are issued in consultation with the Comptroller and Auditor General of India, as mandated under Article 148(5) of the Constitution of India.