Central government employees and pensioners will get an additional 6 per cent dearness allowance from next month, putting a burden of over Rs 6,000 crore (Rs 60 billion) on the exchequer.
Employees and pensioners will get the additional DA with retrospective effect from January one this year, as per a decision cleared by the Cabinet Committee on Economic Affairs (CCEA) in Delhi.
The revised DA would be 22 per cent, payable from next month's salary, against 16 per cent at present, Home Minister P Chidambaram told reporters in Delhi.
The combined burden of the increased DA to employees and the retired will be Rs 6,020 crore (Rs 60.20 billion) from January 2009 to February 2010, he said.
However, the exchequer will take a hit of Rs 5,159 crore (Rs 51.59 billion) for the full year, Chidambaram said.
The decision to increase DA was taken because of the rise in the consumer price index for industrial workers. DA is revised twice a year, from January one and July 1, payable in salaries of March one and September 1, respectively.
The additional financial implication on account of the increase in DA to central government employees (excluding pensioners) would be Rs 4,100 crore (Rs 41 billion) for 14 months from January one this year.
The rise in allowance, called dearness relief, to pensioners will cost the exchequer Rs 1,920 crore (Rs 19.20 billion) during the period.
However, for a full year, the implication would be Rs 3,514 crore (Rs 35.14 billion) because of revised DA for employees and Rs 1,645 crore (Rs 16.45 billion) for pensioners.
Central government employees and pensioners got a hike in salaries from September after the government approved the Sixth Pay Commission's report with some modifications.
