The government has raised the dearness allowance to 100 % from the eralier 90%, benefiting about 50 lakh central employees and 30 lakh pensioners. The increase comes ahead of the the model code of conduct to be imposed by the Election Commission. The code is likely to come into effect with the announcement for the forthcoming general elections shortly.
Normally, such hikes are followed by hikes in DA announced by different state governments. The new hike in DA would take effect from January this year. As per accepted practice, the government uses the Consumer Price Index — Industrial Workers data of the past 1 year to compute the quantum of a DA hike.