Govt move will benefit 50 lakh employees and 30 lakh pensioners

With general elections schedule expected in a few days, the Centre does not want to let go of any opportunity to woo voters. This time, it is to win over Government employees.

On Friday, the Cabinet may consider raising dearness allowances (DA) and dearness relief (DR) by 10 per cent. Once approved, DA and DR will be 100 per cent of the basic pay. DA is given to serving employees while DR is for retired employees. This decision will benefit around 50 lakh serving employees and 30 lakh Central Government pensioners.

Burden on exchequer

The increase will be effective January 1, 2014 and will be included in the March salary. The DA hike will cost around ₹6,390 crore in 2014-15 and if two months of the current fiscal –January and February – are added, then the amount will increase to ₹7,455 crore. Similarly, the annual outgo on account of DR for 12 months and 14 months will be ₹4,684 crore and ₹5,465 crore, respectively.

DA and DR are revised twice a year and effective January 1 and July 1. The revision is based on change in retail inflation, popularly known as Consumer Price Index for industrial workers. Since retail inflation is in double digit for most part of the year, the proposal emerged to revise DA and DR by 10 per cent for the second time in a row.

Rural job scheme

Raising minimum days under the Mahatma Gandhi National Rural Employment Guarantee Scheme may also be considered by the Cabinet on Friday. The proposal seeks to raise the number of minimum guaranteed days to 150 from the current 100 days for scheduled tribes.

Earlier, the Rural Development Ministry had allowed providing additional 50 days of assured jobs in drought-affected areas. On January 4, the Ministry decided to permit additional 50 days of employment for every Scheduled Tribe household living in forest areas, provided that these have no other private property except the land rights given under the Forest Rights Act, 2006.

This rural job programme, the flagship social welfare scheme of the United Progressive Alliance Government, is being implemented from February 2, 2006. It provides at least 100 days of jobs to every rural household. There is no mechanical job under the programme and it’s meant mainly for unskilled people.

Till February 7, 2014, the total employment generation was 155.9 crore person days in 2013-14 of which 25.2 per cent belonged to schedule tribes.

(This article was published on February 25, 2014)
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