Central Government employees and pensioners will get 6 per cent more dearness allowance (DA) and dearness relief (DR) with effect from January 1.
This will benefit 48 lakh government employees and 55 lakh pensioners
The Union Cabinet, in its meeting on Tuesday, approved to release an additional instalment of DA to serving employees and DR to pensioners. With this decision, DA and DR will be 113 per cent of the basic pay.
The increase is in accordance with the accepted formula based on the recommendations of the 6th Central Pay Commission.
Increase in DA will cost ₹6,762.24 crore for the period of 14 months (January, 2015 to February 2016) while on account of DR will, the amount would be ₹7,889.34 crore in the Financial Year 2015-16.
DA and DR are revised twice every year with first one effective from January 1 and second from July 1. Revision is done on the basis of change in retail inflation during last six months.