Central Government Dearness Allowance Hike UPDATE: What is Variable DA and who will be benefitted?

The government recently announced a revision in the rate of variable dearness allowance (VDA). This will directly benefit the employees working under the central government. The hike ranges from Rs 105 to Rs 210 per month and this will be effective from 1 April 2021.  

This will also result in a surge in the rate of minimum wages for central employees or workers. With this step, about 1.50 crore workers engaged in various scheduled employments in Central Sphere across the country will be benefited.

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This is applicable to the establishments under the authority of the central government, Railway administration, mines, oil fields, major ports, or corporations established by the Central government. 

The VDA is revised on the basis of the average Consumer Price Index for industrial workers (CPI-IW) a price index compiled by Labour Bureau. The average CPI-IW for the months of July to December 2020 was used for undertaking the latest VDA revision. 

The rates will be equally applicable to the contract and casual employees or workers. The Minimum Wages Act is implemented in the Central Region for employees engaged in scheduled employments in the Central Region through the Inspecting Officers of the Chief Labour Commissioner (Central).