The Central Government has increased the rate of Dearness Relief (DR) to 31% from 28% for Central Government pensioners/family pensioners. The increased rate of DR will be applicable with effect from July 1st, 2021.
In an Office Memorandum (O.M.) dated 27th October 2021, the Department of Pension and Pensioners’ Welfare (DoPPW) said: “President is pleased to decide that the Dearness Relief admissible to Central Government pensioners/family pensioners shall be enhanced from the existing rate of 28% to 31% of the basic pension/family pension (including additional pension/family pension) w.e.f 01.07.2021.”
The official DR hike notification comes days after the Finance Ministry increased the rate of Dearness Allowance for Central Government Employees to 31% with effect from July 1st, 2021.
Who will benefit?
According to the O.M, the increased rate of DR will be applicable to the following categories of pensioners/family pensioners:
- 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. 4/34/2002-P&PW(D)Vol.II dated 23.06.2017 for restoration of full pension after the expiry of commutation period of 15 years.
- The Armed Forces Pensioners/Family Pensioners, Civilian Pensioners/Family Pensioners paid out of the Defence Service Estimates.
- All India Service Pensioners/Family Pensioners.
- Railway Pensioners/family pensioners.
- Pensioners who are in receipt of provisional pension.
- 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.
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Calculation of fractions
The DoPPW said that the payment on account of Dearness Relief involving a fraction of a rupee shall be rounded to the next higher rupee.
The O.M. further said that 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.
Earlier this month, the Central Government increased the dearness allowance rate to 31% of basic pay from 28%. In an official notification, the Finance Ministry also said that the Basic Pay for calculation of DA as per the new rate would include the pay drawn as per the recommendation of the 7th Pay Commission. It would not include any other type of pay.