Good news for the government employees.
The Cabinet on Wednesday approved an additional 2 per cent hike in Dearness Allowance (DA) and Dearness Relief (DR).
The move will benefit about 1.1 crore Central government employees and pensioners, as per an official press release.
The decision was taken at a meeting chaired by Prime Minister Narendra Modi in Delhi and will benefit about 48.41 lakh Central government employees and 62.03 lakh pensioners.
“The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi has approved to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners w.e.f. 01.07.2018, representing an increase of 2% over the existing rate of 7% of the Basic Pay/Pension, to compensate for price rise,” the press release said.
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.
As per the release, the increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.
The 7th Pay Commission is the latest pay commission which was formed to examine and review the pay structure present at that time and suggest suitable changes which were feasible for both civil employees and the Defence Forces. The commission had submitted its report to the Government on November 19, 2015.
In June 2016, the Union Cabinet, chaired by PM Narendra Modi, had approved the implementation of the recommendations of the Seventh CPC on pay and pensionary benefits.
Earlier this month, the Haryana government had approved the pay scale recommendations to the teaching and non-teaching staff of government universities, government colleges and government-aided colleges with effect from January 1, 2016 as per the 7th Pay Commission recommendations.
Maharashtra chief minister Devendra Fadnavis also promised that the 7th Pay Commission recommendations will be implemented for government employees of the state from January 2019. Fadnavis said that a total of Rs 4,800 crore would be allocated for the implementation of the 7th CPC recommendations in the Budget.