The government has increased the rate of dearness allowance and inflation relief to its total 1.10 crore government employees and pensioners from five to seven percent. The new rate will be effective from January 1, 2018. According to an official release, the approval for the release of additional allowances of dearness allowances was approved in the Union Cabinet meeting chaired by Prime Minister Narendra Modi. It has been increased from existing five percent to seven percent. An increase in dearness allowance for the pensioners for central employees will be applicable from January 2018.
According to the statement, this increase will benefit 8.41 lakh employees and 61.17 pensioners of Central Government.
It states that the increase in dearness allowances, annually to the public exchequer Rs 6,077.72 crore and 2018-19 (for the period of 14 months from January 2014 to February 2019), this amount will be Rs 7,090.68 crore.
This increase in dearness allowance is according to the acceptable formula. This formula is based on the recommendation of the 7th Central Pay Commission.
