(Image used for representation)HIGHLIGHTS
- The Centre hiked dearness allowance and dearness relief by one per cent from the existing 4 per cent
- The new rate will come into effect from July 1 and will benefit about 49.26 lakh central government employees and 61.17 lakh pensioners
- The decision was taken at a Union Cabinet meeting chaired by PM Modi
NEW DELHI: The Centre on Tuesday increased dearness allowance and dearness relief by one per cent from the existing four per cent, benefiting over 1.1 crore employees and pensioners.
The decision was taken at a Union Cabinet meeting chaired by Prime Minister Narendra Modi.
The decision was taken at a Union Cabinet meeting chaired by Prime Minister Narendra Modi.
"Release of additional installment of DA is an increase of 1 per cent over the existing rate of 4 per cent of the basic pay/pension, to compensate for price rise," an official statement said.
The new rate will come into effect from July 1 and is expected to benefit about 49.26 lakh central government employees and 61.17 lakh pensioners.The statement further said the combined impact on the exchequer on account of both DA and DR would be Rs 3,068.26 crore per annum and Rs 2,045.50 crore in the financial year 2017-18 (for a period of 8 months from July 2017 to February 2018).
The new rate will come into effect from July 1 and is expected to benefit about 49.26 lakh central government employees and 61.17 lakh pensioners.The statement further said the combined impact on the exchequer on account of both DA and DR would be Rs 3,068.26 crore per annum and Rs 2,045.50 crore in the financial year 2017-18 (for a period of 8 months from July 2017 to February 2018).
The Cabinet has also approved introduction of Payment of Gratuity (Amendment) Bill, 2017 in Parliament to revise gratuity ceiling for private sector employees.
Dearness allowance and dearness relief are provided to employees and pensioners to neutralise the impact of inflation on their earnings.
As per an agreed upon formula, the Centre hikes the allowance taking 12-month average of retail inflation. The government does not consider the price rise rate beyond a decimal point for deciding the rate of the dearness allowance.
As per an agreed upon formula, the Centre hikes the allowance taking 12-month average of retail inflation. The government does not consider the price rise rate beyond a decimal point for deciding the rate of the dearness allowance.
It was last revised from two per cent to four per cent in March this year.
(With inputs from PTI)
(With inputs from PTI)
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