The Union Cabinet today approved the release of an additional installment of dearness allowance (DA) for central government employees and dearness relief to pensioners with effect from 1 July, 2018. This move, to compensate for the price rise, will result in an increase of 2% over the existing rate of 7% of the basic pay or pension. About 48.41 lakh central government employees and 62 lakh pensioners will be benefited because of the DA hike.
The combined impact to the government exchequer on account of both DA and dearness relief would be Rs 6,112 crore per annum and Rs 4,074 crore in the financial year 2018-19 (for a period of eight months, from July 2018 to February 2019).