In a festive bonanza, Bihar’s NDA government has decided to increase the rate of pension from 35 per cent to 50 per cent for over 3.5 lakh retired employees of the state.

The decision was taken in a meeting of state government officials presided over by Chief Minister Nitish Kumar last evening, official sources said on Thursday.

Taking a clue from the 6th Pay Commission recommendations, the decision would put an additional annual burden of Rs 1000 crore on the state exchequer, sources said.

Though the pension has been revised from January 1, 2006, the actual benefit would accrue from April 1, 2007, they said.