7th Pay Commission: Dearness Relief of Pensioners to Increase Soon; DR Jumped 1600% in Last 6 Years

According to official data, the Dearness Relief (DR) rate given to Central Government pensioners has increased by 1600% since 2016. DR is the government pensioners' equivalent of DA.

While the Central Government distributes Dearness Allowance (DA) to its employees to make up for the loss in real wages caused by inflation, DR is given to Central Government retirees for the same reason.

Data from the Department of Pension and Pensioners' Welfare (DoPPW) show that from 2% in 2016 to 34% in 2022, the DR rate increased by 1600%.

As of July 1st, 2016, the DR rate was 2% of the basic pension or family pension. In addition, it was altered with effect from January 1st, 2017, to 4%. Up to the first of July 2019, the government continued to raise the DR rate by 3% to 5%. The DR rate went through a significant increase by the Central Government of 14% beginning on July 1, 2021.

This increase happened after the pandemic interrupted the updating of the DA and DR rates. With effect starting on January 1, 2022, the current DR rate for Central Government pensioners is 34%.

The DA and DR rates for Central Government Employees and Pensioners, respectively, are expected to rise once more. Every six months, the government updates the DA/DR rate. As a result, DA/DR modification as of July 1, 2022, is still pending. The government is anticipated to release the new DA/DR rates shortly.

The 7th Pay Commission's recommendations are followed for providing DA/DR to employees and pensioners, respectively.

Who calculates the DR?

According to DoPPW, it is the responsibility of the pension disbursing authorities, such as banking institutions, to calculate the amount of DR that is due in each individual case.

Who is eligible for 34% DR?

The Armed Forces Pensioners, Civilian Pensioners Paid Out of the Defence Service Estimates, All India Service Pensioners, and Railway Pensioners/Family Pensioners are all currently getting 34% DR from the Central Government.