New Delhi: The Union Cabinet chaired by the Prime Minister Narendra Modi has given its approval for release of additional 1% Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners under the 7th Pay Commission, hiking both allowances to 5% from 4%.
The additional 1% DA and DR, under the 7th Pay Commission, will be applicable from July 1, 2017.
The release of the additional installment of DA represents an increase of 1% over the existing rate of 4% of the Basic Pay/Pension, to compensate for price rise. This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission, said the government.
The combined impact on the exchequer on account of both DA and DR would be Rs 3068.26 crore per annum and Rs 2045.50 crore in the financial year 2017-18 (for a period of 8 months from July 2017 to February 2018), it said.
About 49.26 lakh central government employees and 61.17 lakh pensioners will get the benefit of this 7th Pay Commission’s recommendation.