Cabinet clears additional dearness pay for central govt employees, pensioners
NEW DELHI : The Union cabinet has approved releasing additional dearness allowance and dearness relief to central government employees and pensioners effective 1 January to soften the impact of inflation, Union commerce minister Piyush Goyal said at a briefing on Thursday. The additional payment represents an increase of 4 percentage points over the existing rate of 46% of the basic pay or pension, the minister said.
The combined impact on the exchequer on account of dearness allowance for government employees and dearness relief for pensioners would be ₹12,868.72 crore a year, the government said in a statement. The decision, coming ahead of the general election in April-May, will benefit about 4.9 million central government employees and 6.79 million pensioners.
The increase is in accordance with an accepted formula that’s based on the recommendations of the seventh Central pay commission, the government said in its statement. Goyal told reporters that with DA becoming 50%, the house rent allowance that employees get will also increase, in addition to improvements in other benefits including gratuity.
In effect, central government employees and pensioners would be benefiting by ₹24,400 crore from January 2024 to February 2025, Goyal said. The benefit to employees and pensioners comes at a time when consumer price index-based inflation was reported at 5.1% for January, down from 5.69% in December.
But food inflation stood higher at 8.3% in January as erratic monsoon impacted farm output. The government expects farm output to expand at a slower pace of 0.7% in FY24, down from 4.7% in FY23.Milestone Alert!
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