Cabinet Approves Additional 2% Hike In Dearness Allowance: 5 Things To Know
The Union Cabinet, chaired by Prime Minister Narendra Modi, approved the release of an additional 2 per cent increase in Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners, according to a press release issued by the government. The hike, which will come in effect from July 1, 2018, representing an increase of 2 per cent over the existing rate of 7 per cent of the basic pay/pension, to compensate for price rise, it further said.
Here are five things to know about the increase in Dearness Allowance:
1. The combined impact on the exchequer on account of both Dearness Allowance and Dearess Relief would be Rs.6112.20 crore per annum and Rs.4074.80 crore in the financial year 2018-19 (for a period of 08 months from July, 2018 to February, 2019).
2. This will benefit about 48.41 lakh Central Government employees and 62.03 lakh pensioners.
3. This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.
4. The hike in Dearness Allowance will come in effect from July 1, 2018.
5. Dearness allowance and dearness relief are provided to employees and pensioners to neutralise the impact of inflation on their earnings.
