The move will benefit 1.1 crore Central government employees and pensioners
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New Delhi: The Union Cabinet on Tuesday approved three percent additional dearness allowance (DA) for the Central government employees and pensioners, which will cost the exchequer Rs 9,168.12 crore annually.
Briefing the media after the Cabinet meeting, Union Finance Minister Arun Jaitley said: "The Cabinet Committee on Economic Affairs (CCEA) has approved an additional DA of three percent over the existing rate of 9 percent to the government employees and dearness relief to pensioners from January 1, 2019.
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The move will benefit 1.1 crore Central government employees and pensioners. "This increase in additional DA is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.
Last year in August, the Union Cabinet chaired by Prime Minister Narendra Modi had approved to release an additional installment of DA to Central government employees and dearness relief to pensioners representing an increase of 2 percent over the existing rate of 7 percent of the basic pay or pension and to compensate for price rise.
The combined impact on the exchequer on account of both DA and dearness relief was set at Rs 6,112.20 crore per annum and Rs 4,074.80 crore in the financial year 2018-19, for a period of eight months from July 2018 to February 2019.DA, which is paid to the Centre employees and pensioners, is a cost of living adjustment allowance to mitigate the impact of inflation on the people.
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