DA Hike: Good news for state government employees. The Punjab government has made the decision to raise the dearness allowance (DA) for around 85,000 government employees. The DA will increase from the current 42% to 60%, as announced by Cabinet Minister Aman Arora on Friday. However, this decision will need the final approval of Chief Minister Bhagwant Mann before it can be implemented. The increase in DA was decided by a three-member cabinet sub-committee, which includes Aman Arora, Finance Minister Harpal Singh Cheema, and Social Security Minister Dr. Baljeet Kaur.
Who will benefit from this decision?
This decision is applicable to employees who were recruited after July 17, 2020. Their basic salaries are set according to the pay matrix of the central government’s 7th Pay Commission, but they currently receive a 42% DA based on the older pay structure of Punjab. However, employees who were recruited before July 17, 2020, will not benefit from this increase, as they are paid according to the Punjab Pay Commission’s pay matrix.
What prompted the increase in DA?
Aman Arora explained that the pay disparity between employees hired after July 2020 and those already in service had grown. In December 2020, the Punjab Cabinet decided to follow the central government’s 7th Pay Commission model for new hires, leading to the creation of two separate categories of employees. Older employees continued to enjoy the benefits of Punjab’s relatively higher basic pay, while new employees’ starting salaries were aligned with the central pay structure. Despite this, new employees were only receiving a 42% DA.
New employees will receive relief
Aman Arora mentioned that many older cadres in Punjab have been earning salaries that are 30% to 70% higher than those of central government employees due to the state’s pay structure. As a result, the lower DA for older employees was somewhat balanced out by their higher basic pay. However, employees hired after July 2020 do not benefit from the higher entry pay in Punjab. Thus, the gap between the 42% DA and the central pay structure is more pronounced for them. This is why the increase in DA is crucial for these new employees.
The decision comes amid major demands from employees
This decision comes after over 300,000 Punjab government employees went on a statewide strike on August 27th. The employees are protesting over several demands, including the release of the pending 18% DA. They have warned that if their demands are not met, they may go on mass casual leave on September 8th. The government has appealed to employee unions to find a solution through dialogue.