Cabinet clears Dearness Allowance hike. All you need to know in 5 points

Information and Broadcasting Minister Prakash Javadekar said the Cabinet had approved 4 per cent hike in DA to 21 pc for 48 lakh govt employees and 65 lakh pensioners.

The Union Cabinet on Friday gave the nod for a 4 per cent increase in dearness allowances (DA) for all government employees and pensioners to 21 per cent. The move will benefit over 1.13 crore people.

The increase in dearness allowances is based on the recommendations of the 7th Central Pay Commission. (REUTERS PHOTO.)

1. The move to hike dearness allowances will come into effect retrospectively from January 1, 2020.

2. The Cabinet, chaired by Prime Minister Narendra Modi, approved the release of an additional instalment of dearness allowance (DA) to all central government employees and dearness relief (DR) for pensioners.

3. There will be an increase of 4 per cent over the existing rate of 17 per cent of the basic pay/pension to compensate for rise in prices of essential commodities.

4. It will benefit about 48.34 lakh central government employees and 65.26 lakh pensioners.

5. The increase is based on the recommendations of the 7th Central Pay Commission. And the increase will also be calculated based on accepted formula.