Cabinet approves 2 percent DA for central employees

The Union Cabinet under the Chairmanship of Prime Minister Narendra Modi on Thursday accorded its approval to release an instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners from July 1 representing an increase of 2 percent of the revised basic pay/pension to compensate for price rise.

The increase is in accordance with the accepted formula, which is based on the recommendations of the Seventh Central Pay Commission.

The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be Rs. 5,622.1 crore per annum and in the Financial Year 2016-17 for a period of eight months (i.e. from July 2016 to February 2017), it would be Rs.3,748.06 crore.

The decision is likely to benefit about 50.68 lakh government employees and 54.24 lakh pensioners.