Union Cabinet Hikes Dearness Allowance To 12 Per Cent, To Benefit Over 1 Crore Central Employees, Pensioners 

In a move that is sure to bring cheer to countless central government employees and pensioners, the union cabinet yesterday (19 February) approved raising the dearness allowance (DA) by 3 per cent with effect from 1 January 2019, reports Mint.

Finance Minister announced the decision after the conclusion of the cabinet meeting, stating that the DA is being hiked by 3 per cent over the current rate of 9 per cent.

Around 48.41 lakh central government employees and another 62.03 lakh pensioners will benefit from the DA increase.

This hike is in line with the formula which was agreed to on the basis of the Seventh Central Pay Commission’s recommendations.

DA is a part of the overall salary of an employee and is calculated as a percentage of the basic pay. It is intended to provide financial security against inflation which increases the cost of living year on year.