Cabinet Approves Additional Instalment of Dearness Allowance and Dearness Relief (Effective from 01.01.2025)
In a move to support Central Government employees and pensioners amid rising inflation, the Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the release of an additional instalment of Dearness Allowance (DA) and Dearness Relief (DR) effective from January 1, 2025. This decision represents a 2% increase over the existing rate of 53% of Basic Pay/Pension.
Key Highlights of the Decision:
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Beneficiaries: 48.66 lakh Central Government employees and 66.55 lakh pensioners.
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New DA/DR Rate: Increased by 2%, reaching a total of 55% of Basic Pay/Pension.
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Financial Impact: The combined cost to the exchequer is estimated at ₹6,614.04 crore per annum.
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Implementation Basis: This increase follows the accepted formula based on the recommendations of the 7th Central Pay Commission.
Implications of the DA/DR Hike
The hike aims to mitigate the impact of inflation on government employees and pensioners, ensuring better financial stability. With this revision, beneficiaries can expect improved financial support, aligning with the rising cost of living.
This decision underscores the government's commitment to supporting its workforce and retirees, ensuring their well-being amid economic fluctuations.