The Union Cabinet on Wednesday gave its nod for 2 percentage point increase in Dearness Allowance (DA) for Central Government employees and Dearness Relief for pensioners with effect from July 1. This is intended to compensate them for price rise in the economy.
The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be Rs 6112.20 crore per annum and Rs.4074.80 crore in the financial year 2018-19 (for a period of 8 months from July, 2018 to February, 2019), an official release said.
This will benefit about 48.41 lakh Central Government employees and 62.03 lakh pensioners. This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission, the release added.