With effect from January 1, 2024, the central government has announced a 4% rise in employees’ Dearness Allowance (DA).
A matching 4% increase in Dearness Relief (DR) has also been made available to retirees of the central government.
4% Rise in DA Of Government Employees Approved
With this rise, the DA and DR for retirees and central government employees will equal 50% of the base pay.
Beginning on January 1, 2024, 13 allowances are anticipated to increase as a result of the DA raise to 50%.
These modifications were outlined in a circular issued by the Employees’ Provident Fund Organization (EPFO) on July 4, 2024.
The EPFO circular highlights that starting on January 1, 2024, payments for the 13 allowances will be made at rates that are 25% higher than the current rates.
The EPFO circular dated 4th July 2024 announced in this regard, saying, “Attention is drawn to the following orders issued by Department of Expenditure/DoPT in the past and request that consequent upon the increase of Dearness Allowance by 4% to 50% w.e.f. 01.01.2024, the payments of the following allowances whereever applicable may be made at enhanced rates of 25% over the existing rates w.e.f. 01.01.2024.”
Which Allowances Will Be Impacted?
Among the 13 allowances impacted are:
- House Rent Allowance (HRA)
- Conveyance Allowance
- Hotel Accommodation
- Deputation Allowance
- Split Duty Allowance
- Touch Location Allowance
- Special Allowance for children of women with disabilities
- Children Education Allowance
- Reimbursement of Traveling Charges within the city
- Reimbursement of Food Charges/Daily Allowance for journeys
- Rate of transportation of personal effects by road on transfer
- Dress Allowance
The total remuneration package for employees of the central government will be considerably improved by the rise in allowances.
The 7th Pay Commission (7th CPC) regulations state that allowance rates rise to 24% after DA reaches 50% of the base pay.
The government’s efforts to guarantee equitable remuneration and promote the welfare of workers and retirees include these modifications.
