Within a week of a pro-people budget, the government has more to offer — 6 per cent increase in dearness allowance to Central government employees and interest subsidy on loans to the farmers.

This is likely to come up before the Cabinet on Friday.The move means that dearness allowance in the salary package of thousands of Central government employees would increase from 41 per cent to 47 per cent.Just last September, the government had increased dearness allowance from 35 per cent to 41 per cent.

For the government, the 6 per cent hike would mean an additional burden of over Rs 1,500 crore on the exchequer. The allowance would be applicable from January 1, 2008, and would benefit over one crore Central government employees.

And let us wait for the Sixth pay commission report

Source : http://news.in.msn.com/national/article.aspx?cp-documentid=1274594