New Delhi, Sep 24: The Union Government Monday hiked Dearness Allowance (DA) by 7 percent, benefiting its 80 lakh employees and pensioners and costing the exchequer an additional Rs 7,408 crore annually.
The hike will be effective from July 1, 2012, and the employees would be entitled for arrears from this date.
The hike in the DA from 65 per cent to 72 percent will cost the exchequer Rs 4,939 crore for the remaining part of the current financial year. The annual burden on account of the DA increase has been estimated at Rs 7,408 crore, says an official release.
The decision, which was approved by the Union Cabinet, will benefit about 50 lakh employees and 30 lakh pensioners of the central government.
The increase in DA is in accordance with the accepted formula which is based on the recommendations of the 6th Central Pay Commission, the release added.
The relief comes in the backdrop of government increasing the diesel price by Rs 5 per litre and retail inflation crossing the double-digit mark.
The government had increased DA last in March this year from 58 per cent to 65 per cent, which was effective from January 1, 2012.

RS 2,300 CR PAY, PENSION PACKAGE FOR DEFENCE PERSONNEL
 Meanwhile, meeting a long-pending demand of 1.3-million strong defence personnel, the government Monday cleared a Rs 2,300-crore (about $430 million) proposal to fix their pay and pension anomalies, based on the recommendations of a panel set up by Prime Minister Manmohan Singh.
 "The cabinet today (Monday) approved Rs 2,300 crore total package for defence personnel based on a report of the committee headed by the cabinet secretary on defence pay and pensions," said a senior government official.
 The committee, headed by Cabinet Secretary Ajit Seth, submitted its report on Aug 8 this year.
 Set up on July 13 this year on the orders of Prime Minister Manmohan Singh, the committee had Principal Secretary to the Prime Minister Pulok Chatterjee and Defence Secretary Shashi Kant Sharma as members, apart from secretaries of departments of expenditure, ex-servicemen's welfare, and personnel and training.
 The government had tasked the committee to look into issues of defence personnel such as common pay-scale for in-service junior commissioned officers and other ranks; initial pay-fixation of lieutenant colonels, colonels, and brigadiers of the army and their equivalents in the other two armed forces; review and enhancement of grade pay; placing all lieutenant generals in the higher administrative grade plus pay scale; and grant of non-functional upgradation (NFU) to armed forces personnel.
 The panel also looked into the ex-servicemen's issues such as 'one rank - one pension' (that all retired officers of the same rank and service tenure should get the same pension), enhancement of family pension, dual family pension, and family pension for mentally and physically challenged children of armed forces personnel on marriage. PTI/IANS

Lastupdate on : Mon, 24 Sep 2012 21:30:00 Makkah time
Lastupdate on : Mon, 24 Sep 2012 18:30:00 GMT
Lastupdate on : Tue, 25 Sep 2012 00:00:00 IST