DA to be hiked tomorrow

Posted by Sa Sukumaran | 07:07:00

The Union Cabinet is likely to approve the proposal to hike dearness allowance paid to the central government employees and pensioners. The hike will be 10% and will take the DA to 90 percent from existing 80 percent and will benefit about 50 lakh central employees and 30 lakh pensioners.

According to the source, the increase in DA to 90 percent would result in additional annual expenditure of Rs 10,879 crore. There would be additional burden of Rs 6,297 crore on exchequer during 2013-14 on account of this hike in DA.

There would be a double digit hike in DA after about three years. It was last in September, 2010, that the government had announced a hike of 10 per cent to be given with effect from July 1, 2010. The DA announced last time was 8% up to 80 percent from 72 percent in April, 2013, effective from January 1, this year.

The government uses CPI-IW data for past 12 months to arrive at a number for the purpose of any DA hike.