Press Information Bureau

Government of India

Ministry of Finance

23-March-2012 19:37 IST

Release of additional instalment of Dearness Allowance and Dearness Relief

The Union Cabinet today gave its approval to release an additional instalment of Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners w.e.f. 1.1.2012 representing an increase of 7% over the existing rate of 58% of the Basic Pay/Pension, to compensate for price rise. The increase is in accordance with the accepted formula, which is based on the recommendations of the 6th Central Pay Commission. The combined impact on the exchequer on account of both dearness allowance and dearness relief would be of the order of Rs.7474.53 crore per annum and Rs.8720.32 crore in the financial year 2012-13 (i.e. for a period of 14 months from January, 2012 to February, 2013).

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SH/SK

Dearness Allowance adjustment under accepted pay commission formula implemented effective January 2012, increasing DA and DR for employees and pensioners. An additional instalment of Dearness Allowance and Dearness Relief was released effective January 1, 2012, increasing the existing rate by seven percentage points in accordance with the accepted pay commission formula; the adjustment applies to central government employees and pensioners and carries a recurring annual fiscal burden as well as a specified budgetary impact for the referenced financial year.