Cabinet approves 5 per cent DA for central government employees

The Union Cabinet on Wednesday approved an additional installment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners with effect from July 1, 2019.

It will benefit about 49.93 lakh central government employees and 65.26 lakh pensioners and represents an increase of 5 per cent over the existing rate of 12 per cent of the basic pay/pension to compensate for price rise.

The impact of the increase in Dearness Allowance and Dearness Relief would be Rs. 15909.35 crore per annum and Rs. 10606.20 crore in this financial year

An official release said the increase is in accordance with the accepted formula, which is based on the recommendations of the Seventh Central Pay Commission.

Dear Allowance and Dearness Relief is paid to central government employees and pensioners to adjust the cost of living and to protect their basic pay/pension from erosion in the real value. Dear Allowance and Dearness Relief is revised twice a year from January 1 and July 1.