Pre-election bonanza for government employees

Ahead of the crucial general elections, the Dearness Allowance has been hiked by 3 per cent over the existing rate of 9 per cent. The cabinet approved a hike in dearness allowance (DA) for the central government employees cum pensioners. The allowance has been increased from 9 per cent to 12 per cent with effect from January 1, 2019 to “compensate” for price rise.

This move by the cabinet is set to benefit 1.1 crore central government employees and pensioners. The decision was taken during a Central Cabinet meeting that was chaired by Prime Minister Narendra Modi. After the announcement, Finance Minister Arun Jaitley said that the combined impact on the exchequer on account of both DA and DR would be Rs 9,168.12 crore per annum and Rs 10,696.14 crore in 2019-20 (for a period of 14 months from January 2019 to February 2020).

According to a press release by PIB, “This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission (CPC). The combined impact on the exchequer on account of both DA and DR would be Rs. 9168.12 crore per annum and Rs. 10696.14 crore in the FY 2019-20 (for a period of 14 months from January 2019 to February 2020).This will benefit about 48.41 lakh Central Government employees and 62.03 lakh pensioners.”

This hike in dearness allowance will benefit about 48.41 lakh central government employees and 62.03 lakh pensioners. According to PTI, this increase is in accordance with the accepted formula, which is based on the recommendations of the Seventh Central Pay Commission.