Higher DA for Babus - Serving and Retired
SOME fifty lakh central government employees are to get an additional instalment of Dearness Allowance at 2% of the basic pay from 1st July 2016. This will be on the enhanced pay as per the 7th Pay Commission Report. More than 50 lakh pensioners will also get a similar benefit.
The Dearness Allowance (DA) is paid to Central Government employees to adjust the cost of living and to protect their Basic Pay from erosion in the real value on account of inflation. DA is based on the All India Consumer Price Index (Industrial Workers) which was 269 on 1.1.2016 and stood at 280 on 1.7.2016. The inflation upto 1.1.2016 was subsumed in the new basic pay fixed on 1.1.2016, which was 2.57 times the prevailing basic pay. The DA hike will cost the nation 3748 crores of rupees in this financial year.