Fri Feb 07 16:22:08 UTC 2025: ## Kerala Government Announces Pay Hike and Arrears for Employees in State Budget

**Thiruvananthapuram, February 7, 2025** – The Kerala State government has announced significant financial relief for its employees and pensioners in the budget presented on Friday. Finance Minister K.N. Balagopal stated the government’s commitment to safeguarding employee entitlements, noting that past difficulties regarding arrears have been addressed.

Key highlights of the budget include the disbursement of two installments of pay revision arrears this financial year, merged with provident fund contributions. One installment of dearness allowance (DA)/dearness relief (DR) will also be granted, with an enhanced rate effective April. The two-installment lock-in period for DA arrears has been waived. The final installment of service pension revision arrears (₹600 crore) will be released this month. Daily wage and contract employees will receive a 5% wage increase.

Furthermore, a housing loan scheme for government employees will be revamped, including a 2% interest subsidy on loans up to ₹50 crore. A cooperative housing project aiming to build at least 100,000 affordable houses will also benefit government employees.

While the budget addressed immediate financial concerns, the Minister stated that decisions regarding an assured pension scheme will be made after reviewing the Union government’s unified pension scheme and similar state-level initiatives.

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