At a time when a consumption boost is needed in the wake of dwindling incomes and consequent fall in demand, the Modi government has announced a hike in the Dearness Allowance for central government employees. As per a government order, Central government employees will see an 11 percent increase in their DA from July 1.

The increase from 17 percent to 28 percent has come in for praise from several quarters.

The revised salary will take effect from July 1. The move has been welcomed by lakhs of central government employees. Hitherto, provisional family pension alone was available for a period of 6 months.

The rise in Dearness Allowance will have an impact not just on the salary but also on the Provident Fund. It will trigger an increase in the corpus of the Provident Fund. Also, employees will receive more gratuity.

In view of the pandemic, government employees are well-cushioned. At a time when private-sector employees have witnessed pay cuts, sarkari employees can fill the vacuum by increasing their expenditure.