Assam Government Faces Financial Strain Due to Increased Dearness Allowance
Financial Implications of Enhanced Dearness Allowance
File image of Assam Assembly in session. (Photo:PTI)
Guwahati, July 15: The Assam government is set to incur an additional monthly expense of Rs 49.82 crore due to the increase in Dearness Allowance (DA) and Dearness Relief (DR) for state employees and pensioners, which has now reached 60 percent. This announcement was made during a session of the Legislative Assembly, where it was also noted that the state's total outstanding debt has escalated to Rs 1.62 lakh crore.
In response to a query from Congress MLA Jakir Hussain Sikdar, Finance Minister Jayanta Mallabaruah explained that this extra expenditure will be reflected in the salary and pension allocations. The revised DA and DR rates took effect in June 2026 and were included in the salaries and pensions distributed in July, following a notification from the Finance Department on June 16.
When asked why the DA increase was not aligned with the central government's January adjustments, Mallabaruah clarified that the state government determines salary revisions and benefits based on the recommendations of the State Pay Commission and the financial status of Assam.
He highlighted that Assam is one of only six states to have raised the DA to 60 percent.
Regarding the Old Pension Scheme (OPS) for employees recruited before February 1, 2005, the Minister stated that the Finance Department had requested comprehensive data from all administrative departments in March 2025 to facilitate the implementation of the Budget announcement under the Astadash Mukutar Unnoyonee Mala initiative.
However, the process of verifying recruitment records from over two decades has proven to be lengthy. While some departments have provided the necessary information, inconsistencies have been identified in various cases concerning sanctioned posts, recruitment advertisements, result declarations, and joining dates.
The Finance Department is currently engaged in discussions with department heads and senior officials to validate these records. Mallabaruah assured that the government is dedicated to moving forward with the proposal once the verification is complete.
On the topic of the state's revenue collection and fund allocations for the current financial year, the Minister noted that actual revenue figures will be available only after the Principal Accountant General releases the Finance Accounts at the end of the fiscal year.
He added that while details regarding funds released under the ceiling system have been presented to the Assembly, information on non-ceiling system releases will only be accessible after verification by the Accountant General.
In written responses to additional questions from Opposition MLAs, Mallabaruah revealed that Assam's outstanding debt has surged more than four and a half times in the past decade, increasing from Rs 35,690 crore on March 31, 2016, to Rs 1,61,761 crore on March 31, 2025, according to the latest Accountant General data.
Out of the total liabilities, Rs 18,582 crore consists of interest-free loans with a 50-year repayment term, resulting in an interest-bearing debt of Rs 1,43,179 crore. The Minister also disclosed that Assam paid Rs 9,467.75 crore in interest to various lenders during the 2024-25 financial year.