Additional 2% Dearness Allowance approved by Union Cabinet

Union Cabinet approves additional 2% Dearness Allowance

The Union Cabinet, chaired by Mr. Narendra Modi (Indian Prime Minister) has approved release of an additional installment of Dearness Allowance (DA) to the employees Central Government and Dearness Relief (DR) to pensioners w.e.f. 01.01.2017. It has hiked by 2 percentage over the existing rate of 2% of the Basic Pay/Pension, to compensate for price increase.

This hike is in accordance with the accepted formula, which is based on the 7th Central Pay Commission recommendations.

The combined impact on the exchequer on account of both (DA) Dearness Allowance and Dearness Relief (DR) would be Rs. 5,857.28 crore (P.A) per annum and Rs. 6,833.50 crore in the Financial Year 2017-2018 (for a period of 14 months from January, 2017 to February, 2018).

This will useful about 48.85 lakh Central Government employees and 55.51 lakh pensioners in India.