Central government employees and pensioners will get three per cent increased Dearness Allowance with the cabinet approving the second installment of additional DA, which was due from July 1 this year.
Following the increase, the rate of DA will be 41 per cent from the existing rate of 38 per cent and this increase would cost the exchequer Rs 1195 crore in a full year and Rs 797 crore in the current financial year.
The additional financial implication on account of this increase of DA to employees is estimated to be Rs 889 crore per annum, Parliamentary Affairs Minister Pramod Mahajan said, adding it worked out to Rs 593 crore for the eight months during the current financial year.
In the case of pensioners, the figures worked out to be Rs 306 crore for the full year and Rs 204 crore for the eight months in the current fiscal. Dearness Allowance to central government employees is revised twice a year from January one and July one, with the increase calculated on the basis of percentage increase in 12 monthly average of All India Consumer Price Index for Industrial Workers.
The base for this calculation is the base index of 306.33 on which existing scales of pay are related. All India Consumer Price Index for the period ended June 2000 works out to 433.33, which constitutes an increase of 41.56 per cent over the base index of 306.33 for the year 1996.
Bureau Report
