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Oct 182019
 

Hike of dearness allowance to government employees and assistance to farmers 2019

Dearness allowance has been increased by 5% by Union Cabinet benefiting almost 50 lakh government employees. This move will also help near about 65 lakh pensioners, and it will be counted from July onwards. The hike has been decided on the recommendations of the seventh pay commission and a sum of rupees 16,000 crores has been allotted for the same. This hike can be considered as one of the highest in the past few years. Apart from this, Union Minister Prakash Javadekar is of the opinion that this raise is much greater compared to its previous rate of 2% to 3%. Therefore, the current DA hike from 125 to 17% is a gift from the government to the employees.

How Cabinet has decided to help farmers?

Apart from the hike in DA, Cabinet has also decided for fund release for helping farmers under the Pradhan Mantri KisanSamman Nidhi scheme. This shall help to improve the economic condition of the deprived farmers. Through this, income support of rupees 6000 will be given to farmer’s families yearly. However, it has been added that the yearly amount will be given in three installments to farmers. It shall be directly credited to the linked bank account and paid through DBT mode. However, the benefits given to farmers after 1st August 2019 has been processed on the basis of Aadhaar details stored in the database. In case Aadhaar card details of farmer’s are not updated, it shall delay in providing the installment to farmers as per the scheme. Therefore, government will validate the data provided by farmers before providing the scheme benefits to farmers. In respect to this financial help to farmers, near about than rupees 27,000 crores have been released by the government.

Here, Cabinet also wanted to include 5300 families under Jammu and Kashmir package. This can be considered as part of Rehabilitation package that has been sanctioned by Cabinet in November 30th 2016. Therefore, immediate approval from government shall help farmers to get quick financial assistance as has been promised by schemes. This in turn, shall provide sources of sustained income for the farmers.

How raised DA can help employees?

Dearness allowance or dearness relief is given to Central government employees that help to adjust the increased cost of living to. It is known that the DA is revised twice every in a year.However, this Diwali gift has been finalized in the Cabinet headed by Prime Minister NarendraModi. The raised DA will cover up all government employees along with pensioners. So, this 5% hike in DA has been sanctioned in one go as compared to lower rates of the past few years.

Details of financial implications of raised DA

The financial implication of raised DA is near about rupees 8590.20 crores yearly and rupees 5726.80 crores during 2019-2020 financial years. Adding to this, the DA of pensioners is about rupees 7319.15 crores yearly and rupees 4870 croresin the present financial year. Therefore, increase in both dearness allowance and relief is effective twice in a financial year for help of government employees cope up with the increased cost of living.

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