DA to Central Government Employees from 1st Jan 2023

At present, the rate of Dearness Allowance for Central Government personnel is 38%. It is expected that this allowance will be increased to 42% from 1 January 2023, after an official announcement from the Central Government. Employees and pensioners of the Central Government are eagerly anticipating this good news!

Dearness Allowance (DA) is a form of compensation that is paid to Central Government employees to help them cope with the rising cost of living. It is calculated as a percentage of the basic salary of the employee and is revised regularly to ensure that its value is maintained despite inflation. The rates of DA are determined by the Indian Government after considering the Consumer Price Index (CPI) and other economic indicators. See the below table;

The current DA rate for Central Government employees is 38% and this rate will remain in effect until December 2022! After that, the DA rate is expected to increase to 4%, as announced by the Government in March 2023. The expected DA rate from January 2023 will be 42%.

When the Dearness Allowance (DA) is increased, the rate of Transport Allowance (TA) will simultaneously rise in line with it! For instance, if the extra DA rises by 4%, the TA will also go up by 4% from the employee’s entitlement rate. If an employee is entitled to receive TA of Rs. 3600, after the DA increase, this amount will increase to Rs. 5112 per month.