The Cabinet on Wednesday approved additional 2 per cent hike in Dearness Allowance (DA) and Dearness Relief (DR), a move that will benefit about 1.1 crore central government employees and pensioners, an official release said. With this the Dearness Allowance stands now at 9% from 7%.
The impact on the exchequer on account of both DA and DR would be Rs. 6,112.20 crore per annum and Rs. 4,074.80 crore in the financial year 2018-19 (8 months from July, 2018 to February, 2019). The hike will be effected from July 1, 2018, the release said.
The decision was taken at the Cabinet meeting chaired by Prime Minister Narendra Modi
The increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission. However the beneficiaries will have to wait till the finance ministry issues the order for the hike