Government on Friday raised dearness allowance to 100 per
cent, from 90 per cent, benefiting its 50 lakh employees and 30 lakh
pensioners.
The decision to hike DA for its employees and to provide
dearness relief for pensioners, by 10 per cent to 100 per cent was taken by the
Union Cabinet in its meeting held in New Delhi.
“The Union Cabinet has approved the proposal to hike
Dearness allowance for its employees and dearness relief for its pensioners to
100 per cent in its meeting held here,” a source said.
This increase in the dearness allowance by the UPA-2
government comes ahead of the imposition of the model code of conduct by the
Election Commission.
The code is likely to come into force with the
announcement of the schedule for the forthcoming general elections in a week or
so.
Also it would be the second double digit DA hike in a
row.
The government had announced a hike of 10 per cent to 90
per cent in September last year, effective from July 1, 2013.
The new hike in DA would be effective from the January 1
this year.
As per practice, the government uses Consumer Price
Index- Industrial Workers data of the past 12 months to arrive at a quantum for
the purpose of any DA hike. Thus, the retail inflation for industrial workers
between January 1 to December 31, 2013 was used to take a final call on the
matter.
According to the provisional data released by government
on January 31, the retail inflation for factory workers in December was 9.13
per cent. The revised retail inflation data for December is scheduled to be
released on Friday.
An official had said earlier that the preliminary
assessment suggests that DA hike will not be less than 10 per cent and would be
effective from January 1.
The government also approved the implementation of 1997
pay scale along with increase in the retirement age from 58 to 60 for the
employees of Hindustan Machine Tools Limited (HMT).
The cabinet also approved a soft loan of Rs 200 crore for
paying salaries to employees of loss-making PSU Indian Telephone Industries
(ITI) Ltd.
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