Central staff, pensioners to get 2% additional DA from 1 July

The central government will give additional DA of 2 per cent to its employees and 2 per cent additional dearness relief (DR) to its pensioners beginning 1 July, as per a cabinet note issued today.

The decision, taken at a meeting of the union cabinet chaired by Prime Minister Narendra Modi, will have an annual revenue impact of Rs6112.20 crore on the central budget, and a Rs4074.80 crore impact on the centre’s finances for the financial year 2018-19 (8 months from July 2018 to February, 2019). 
The DA/DR increase represents an increase of 2 per cent over the existing rate of 7 per cent of the basic pay/Pension, and is indented to compensate for price rise.
This will benefit over 4.84 million central government employees and 6,2 million pensioners.
This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission, an official release stated.
The increase is in accordance with the accepted formula, which is based on the recommendations of the 7th Central Pay Commission.
In March this year, the Union Cabinet had increased dearness allowance (DA) for government employees and pensioners to 7% from 5%, with effect from 1 January 2018. The DA hike was in accordance with a formula based on the recommendations of the 7th Pay Commission for central government employees.