As part of its 7th Pay Commission decisions, the Union Cabinet has increased the dearness allowance (DA) and dearness relief (DR) by 2 per cent for the central government employees.
The government decision is like to benefit pensioners as well.
The increase in DA and DR will come into effect from January 2018, according to an official statement.
The statement stated that the Union Cabinet, chaired by Prime Minister Narendra Modi, has also given its approval to release an additional instalment of dearness allowance (DA) to Central government employees and dearness relief (DR) to pensioners…representing an increase of 2 per cent over the existing rate of 5 per cent of the basic pay/pension, to compensate for price rise.”
The hike in DA and DR would cost the exchequer about Rs 6077.72 crore per annum and Rs 7090.68 crore in the financial year 2018-19, from January this year to February, 2019.
The hike in DA and DR is in accordance with the accepted formula that is based on the recommendations of the 7th Central Pay Commission.