Cabinet Approves 6-pc DA Hike For Central Govt Employees

In a big bonanza for central government employees and pensioners, the Union Cabinet on March 15 gave a go ahead to a proposal to release additional instalments of dearness allowance (DA) and dearness relief (DR) in cash at the rate of 6%. The new rates would be effective retrospectively from January 1, 2007. Additionally, the Cabinet cleared enhancing the age of superannuation for teaching positions in centrally-funded educational institutions from 62 to 65 years with provision for re-employment up to 70 years against sanctioned vacancies. It is understood that the Cabinet Committee on Economic Affairs (CCEA), which also met on Thursday, cleared a proposal to extend Rs 75 per tonne bonus on minimum support price (MSP) of Rs 750 for procurement of wheat for supply through PDS. The DA hike will raise the allowance component for central government employees from present 29% to 35% of the basic pay, minister for information, broadcasting and parliamentary affairs PR Dasmunsi told reporters after the Cabinet meeting. While the employees would take a fatter package, the move would cost the government an additional outgo by Rs 3,900 crore for the FY 2007-08 (14-month period including January and February 2007). The DA hike is the second in less than six months'' time. The Centre revises DA for its employees bi-annually, in January and July, on the basis of movement in the consumer price index for industrial workers. The government had last raised the DA and DR by 5% in September, 2006. The Cabinet also gave its approval to setting aside an expenditure budget of Rs 767 crore for the organising committee for Commonwealth Games, 2010. Also, a new post of Principal Commissioner, Commonwealth Games will be created to co-ordinate all matters relating to the Games on behalf of DDA.