The Union Cabinet is likely to approve the hike in the dearness allowance of the employees and pensioners, on Friday. Once approved, the dearness allowance for the employees and the dearness relief for pensioners will become effective from July 1, 2012. It may take few more days for the issue of the order by the Finance Ministry.
The hike, which is calculated based on CPI-IW is supposed to be to 72 per cent from the current 65 per cent. The CPI is currently around 10%, that may push for an even higher DA hike during January 2013. This hike will benefit 50 lakh employees and 30 lakh pensioners. However the hike may be negligible when compared to the price hike that we can expect from the recent fuel price hike.
According to confirmed sources, the proposal to increase dearness allowance (DA) by 7 per cent of the basic pay is scheduled to come up for consideration of the Union Cabinet on Friday,
The Last DA hike effective from Jan 2012 was also 7%.
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