The government on Thursday cleared a six per cent hike in dearness allowance (DA) for central government employees.
The decision was taken at a Union Cabinet meeting chaired by External Affairs Minister Pranab Mukherjee. Employees would get a dearness allowance of 22 per cent on their basic salary from 1 January.
In the past three years, this decision on DA hike was taken in mid-March. The move to fast-track the decision this time is being linked to the model code of conduct coming into force shortly as elections are expected to be called in a few days. The hike will cost the exchequer an additional Rs 3,514 crore per annum.
Home Minister P Chidambaram also announced a plan to develop roads in and around 33 Naxalite-affected districts in eight states.