HYDERABAD: The State Government has enhanced dearness allowance (DA) to its employees by 2.826 per cent with effect from January 1, 2006, in line with the latest price index projected by the Government of India.

As a result, the total DA now will be 14.130 per cent. Finance Minister K. Rosaiah told The Hindu that the funds required for the DA hike was being released.

An official press note said the new DA would be paid with the salary for June payable in July. DA arrears for January to May, however, would be credited to the provident fund. In case of employees due for retirement before October 1, 2006, the arrears would be paid in cash as they are exempted from contributing to provident fund for the last four months of service.

The hike is applicable to all categories of employees, including those of local bodies like zilla/mandal parishads, municipalities/corporations, agriculture market committees and teaching and non-teaching staff of aided educational institutions and universities,

An order issued on Monday said that judicial officers were also eligible for the benefit.

Meanwhile, the six power utilities in the State--AP Transco, AP Genco and four distribution companies-- signed an agreement valid up to 2010 for enhancing the pay scales for their employees by allowing a fitment benefit of 16 per cent on an average. The additional financial burden on these utilities will be around Rs. 180-200 crores.

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