A bonanza of Rs.7,889 crore for this fiscal and Rs.6,762.24 per thereafter has been approved for the 10 million serving and retired staff of the central government in the form of a hike in dearness allowance.
A meeting of the cabinet, chaired by Prime Minister Narendra Modi here on Tuesday, approved the release of an additional instalment of dearness allowance with effect from January 1 this year at the rate of 6 percent over the existing rate of 107 percent.
"Central government employees as well as pensioners are entitled for dearness allowance or relief at the rate of 113 percent of the basic pay with effect from Jan 1," said an official note adding, this was based on the formula suggested by the 6th Pay Commission.
"The combined impact on the exchequer on account of both would be of the order of Rs.6,762.24 crore per annum, and Rs.7,889.34 crore in the financial year 2015-16 (that is, for a period of 14 months from January 2015 to February 2016)," it added.
"This will benefit 48 lakh government employees and 55 lakh pensioners."