Diwali Gift: Government hikes DA from 5% to 17% for employees and pensioners

New Delhi : The Dearness Allowance of the Central Government employees and pensioners has been increased from 5% to 17% this year, said Union Minister Prakash Javadekar, claiming it to be a Diwali gift for them. Around 50 lakh employees will be benefited with this.

The decision was approved during a Cabinet meeting chaired by Prime Minister Narendra Modi on Wednesday morning. The government will have to bear the cost of Rs 16,000 crores with the move.

"This will bring cheer to the working class, the central government has been announcing steps for many sectors," Mr Javadekar said.

"This is the highest ever 5 percentage points increase in DA in one go by the central government," he added.

Around 65 lakh pensioners would also benefit, he added.

Dearness Allowance is a component of salary paid to employees to counter the effect of inflation.