Chennai: Tamil Nadu Government today announced a seven per cent hike in dearness allowance for its employees, which would cost the exchequer a sum of over Rs 1,500 crore annually.

Chief Minister O Panneerselvam held a review meeting with his senior cabinet colleagues and top officials in which it was decided to implement the hike, increasing it from 100 per cent of the basic pay to 107 per cent.

Panneerselvam said that the hike was decided in line with a similar rise in DA for Central government employees earlier.

About 18 lakh persons including officials in local bodies, staff of government aided educational institutions, village assistants employed in Revenue Department, Anganwadi and nutritious meal centre workers and pensioners among others will benefit, he said in a statement.

He said his predecessor and party chief J Jayalalithaa had often hiked DA to state government employees on par with their counterparts at the Centre.

The DA hike will be calculated with retrospective effect  from July 1, 2014, he said, adding, the move will cost the state exchequer a sum of Rs 1558.97 crore annually.

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