New Delhi:
The government today raised Dearness Allowance or DA to 100 per cent, from existing 90 per cent, benefiting its 50 lakh employees and 30 lakh pensioners.
The decision was taken at a Cabinet meeting today. The new hike in DA would be effective from the January 1 this year.
"The Union Cabinet has approved the proposal to hike Dearness allowance for its employees and dearness relief for its pensioners to 100 per cent in its meeting held here," a source said.
This increase in the DA by the UPA-2 government comes ahead of the imposition of the model code of conduct by the Election Commission for Lok Sabha election, due by May.
This is the second double digit DA hike in a row. The government had earlier announced a hike of 10 per cent to 90 per cent in September last year, which came into effect retrospectively from July 1, 2013.
As per practice, the government uses Consumer Price Index-Industrial Workers data of the past 12 months to arrive at a quantum for the purpose of any DA hike. Thus, the retail inflation for industrial workers between January 1 and December 31, 2013 was used to take a final call on the matter.
According to the provisional data released by government on January 31, the retail inflation for factory workers in December was 9.13 per cent. The revised retail inflation data for January is scheduled to be released today.
An official had said earlier that the preliminary assessment suggests that DA hike will not be less than 10 per cent and would be effective from January 1.