DA Hike Update – Govt Increases Dearness Allowance to 55% for 16 Lakh Employees

DA Hike : Big news for state government employees. On Wednesday, the state government announced a two percent increase in the dearness allowance (DA) for 16 lakh state employees, aligning with a similar move by the central government. As a result, employees will now receive a monthly DA of 55 percent, up from the previous 53 percent. This adjustment will take effect from January 1 of this year, and the increased DA will be disbursed in May alongside the April salary. This change will add an extra financial burden of Rs 107 crore per month to the state government.

The official government order was released on Wednesday, following the central government’s announcement to raise DA on April 2. Just a week later, the Yogi government also decided to implement this increase. This decision will positively impact state employees, including regular and full-time staff at aided educational and technical institutions, urban local bodies, work charge employees, and those on UGC pay scales.

According to the order from Additional Chief Secretary Finance Deepak Kumar, the increased DA for the period from January 1, 2025, to March 31, 2025, will be credited to the provident fund accounts of the officers and employees. For those not enrolled in a provident fund, the amount will either be deposited into their Public Provident Fund (PPF) account or provided as a National Savings Certificate (NSC).

For officers and employees under the New Pension Scheme (NPS), the increased DA will be allocated to their pension accounts, with 10 percent of the remaining amount from January 1, 2025, to March 31, 2025, being deposited, while the state government will contribute an additional 14 percent to the pension account. The remaining 90 percent will either go into a PPF or be issued as NSC. Employees who retire between January 1, 2025, and the date of the government order (April 9, 2025), or those who are set to retire within six months, will receive the increased DA in cash. This adjustment will result in an additional financial burden of Rs 107 crore on the state government.