On behalf of providing relief to the central government for its employees and to boost their morale, a set of concessions has been granted, allowing more than 50 million present-level employees and 65 million pensioners out there to benefit from these offers. The event comes amid mounting expectations in the pay structure revision and pension reforms under different ongoing schemes and policy updates.
Key Benefits Announced
Among the major announcements stands a 4% raise in Dearness Allowance (DA) and Dearness Relief (DR), respectively, thereby setting the DA at 50%. This increase has been done as per the formula laid down by the government, which takes into account the average inflation rate to enable employees and pensioners to better deal with present increases in living costs. The order is meant to apply from 1 July 2025, and the arrears for the last three months will be cleared with the payment of the next month’s salary.
The other major news is the revision in fitment factor in the proposed Eighth Pay Commission. While the new pay commission is yet to be notified, all signs currently point to a huge jump in salaries for employees at the entry level, with basic minimum pay alone being raised from ₹18,000 to more than ₹26,000.
Benefits For Pensioners
Also, pensioners will receive benefits with the minimum monthly pension under EPS-95 being raised from Rs 1,000 to Rs 7,500 plus DA. This has long remained the demand, but finally, the discussions are on between the labour ministry and EPFO to see this hike implemented from later in 2025.
Moreover, relaxations to gratuity rules and extra leave benefits for central government employees have been approved by the government, thus further easing post-retirement adjustments.
Positive Economic Impact
Experts feel that this financial boost will improve the living standards of millions of government workers and pensioners-to-be and will undoubtedly push the domestic economy by way of an enhancement in purchasing power.
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