By IANS
New Delhi : The cabinet Thursday approved release of an additional instalment of dearness allowance (DA) and dearness relief (DR) to central government employees and pensioners, retrospectively from July 1 – entailing a burden of Rs.32.84 billion on the exchequer.
“The rate of DA from July 1, 2007 will be 41 percent for all central government employees, constituting an increase of six percent over the existing 35 percent,” Information and Broadcasting Minister Priya Ranjan Dasmunsi told reporters.
“The pensioners too will get their DR at the same 41 percent rate, also effective from July 1,” he said.
“This DA increase will cost the national exchequer Rs.22.06 billion per annum. For the current financial year 2007-2008, however, the government will have to mobilise another Rs.14.71 billion.
“On the DR front for the pensioners, the total annual burden on the national exchequer has been worked out to Rs.10.78 billion whereas for the current financial year it has been worked out to Rs.7.18 billion,” he said.
“The combined impact on the exchequer on account of both DA and DR would be Rs.32.84 billion for a full year and Rs.21.89 billion for the remaining period of the current financial year,” said Dasmunsi.
“The 12-monthly average of the All India Consumer Price Index (CPI) for the period ending June 2007 works out to 587.62 which constitutes an increase of 91.82 percent over the base index of 306.33.
“Of the total DA awarded to a central government employee 50 percent has been merged with the basic pay with effect from April 1, 2004 and the rest will be part of the allowances,” said the minister.