Special Correspondent

Payment will be with retrospective effect from January

NEW DELHI: The Union Cabinet on Thursday gave its approval for release of an additional instalment of dearness allowance to Central Government employees and dearness relief for pensioners in cash at the rate of six per cent. With this, the rate of dearness allowance and dearness relief will go up to 35 per cent. The payment will be with retrospective effect from January.

Announcing this, Union Minister and Cabinet spokesperson Priyaranjan Dasmunsi said the additional financial implications on account of the increases were estimated at Rs. 3,343.2 crore a year. For the financial year 2007-08 (from January 2007 to February 2008), it would be Rs.3,900.42 crore.

Of the additional outgo, the Dearness Allowance component will account for Rs. 2,265.12 crore a year and Rs. 2,642.64 crore for the financial year 2007-08. The respective figures for dearness relief will be Rs.1,079.08 crore and Rs. 1,257.78 crore.

The Cabinet also decided to increase the retirement age for teaching positions in Centrally funded institutions in higher and technical education from 62 to 65 years, with provision for re-employment beyond 65 and up to 70 years against sanctioned vacancies if they were not filled by regular candidates, after screening under UGC guidelines at the age of 65 years.


The move is aimed at addressing the chronic shortage of faculty in these institutions, by retaining experienced hands. Under consideration for a while now, the proposal gained currency in the wake of the Government's decision to increase student intake by 54 per cent over three years to provide reservation to the Other Backward Classes in Central educational institutions.

Chaired by Prime Minister Manmohan Singh, the Cabinet also gave its nod for an expenditure budget of Rs.767 crore of the Organising Committee of the Commonwealth Games 2010 to be recouped on the basis of revenue neutrality with flexibility to sanction an escalation up to 15 per cent. The fund would be provided to the panel as an unsecured loan at the Government rate of interest prevailing at the time of release. The repayment of the loan and the interest would begin after the commencement of revenue generation by the Committee. In addition, the Cabinet cleared the expenditure budget of Rs. 1,000 crore of the Sports Authority of India and the expenditure budget of Rs. 30 crore of the All India Tennis Association for development of venue infrastructure by the two organisations. They would also be allowed an escalation of up to 15 per cent in their budget.

The decision would set in motion the activities of the various stakeholders and beginning of the work on major sports and infrastructure projects by the middle of the year, so that they were completed by 2009-end, well in time for the event.

The Cabinet gave its nod for creating one temporary post of Principal Commissioner (Commonwealth Games) in the Delhi Development Authority for coordinating all matters relating to the games. The post will be for a maximum of five years, but not extended beyond three months after completion of the games. It will carry a pay scale of Rs. 18,400-Rs.22,400.

The Cabinet also gave its approval for the implementation of the Government of India-UNDP Disaster Risk Management Programme in 169 multi-hazard prone districts in 17 States and 38 cities covered under the Urban Earthquake Vulnerabilities Reduction Project, with a multi-donor assistance of Rs. 153 crore ($34 million), including Rs. 88.37 crore already spent by UNDP. Besides, it cleared the extension of the currency of the Special Railway Safety Fund for one year and decided to fund the balance works valued at Rs. 1,882 crore, with money sourced from the Finance Ministry to the extent of Rs. 1,176 crore and Rs. 664 crore from the balance available in the Fund. If more funds were required, they would be met from the Railway's internal resources.