Following in the footsteps of the Centre, the Yogi Adityanath government in Uttar Pradesh has also decided to increase the Dearness Allowance (DA) of 28 lakh state government employees and pensioners.
The Chief Minister has directed the finance department to immediately draw up a plan that will benefit around 16 lakh state government employees and 12 lakh pensioners.
The DA revision was withheld in 2020 due to the financial stress on state coffers in the wake of the Covid-19 pandemic. The Uttar Pradesh government had announced in April 2020 that there would be no increase in DA till July 1, 2021.
Normally, the DA is increased twice annually, on January 1 and July 1. The decision to defer the revision has deprived government employees of three hikes.
A government spokesman said: "The Centre announced revision of DA from 17 per cent to 28 per cent of the basic salary on July 14. The state will follow suit and the chief minister has asked the finance department to immediately draw up a proposal on this, so that the change can be implemented at the earliest."
The new rate, however, will be applicable only from July 1, 2021, and till then the rates revised on July 1, 2019 will be applicable.
“The decision was taken as there had been a fall in the state’s revenue due to Covid-19. The government needed funds for Covid-19 prevention, management, treatment and relief work. UP would have increased DA by 4% from January 1, 2020, as decided by the Centre, but had to put the decision on hold due to the pandemic,” the official said.
"We cannot say if and by how much the DA would have been revised in July 2020 and January 2021. Presuming that it would have been revised by 4 per cent on both occasions, it is being estimated that the state government would have saved around Rs 7,000 crore in a year."
The order will benefit state government employees, employees of aided educational institutes and technical education institutes, and those of urban local bodies, along with pensioners.