7th Pay Commission Latest Update Today: When last time, the DA was hiked in October 2023, the DA was increased by 4 per cent to 46 per cent.
7th Pay Commission Latest News: Here comes a piece of wonderful news for the Central government employees, The Centre is likely to announce 4% DA Hike for them during the cabinet meeting today. The Cabinet Committee on Economic Affairs (CCEA), under the chairmanship of Prime Minister Narendra Modi, will be held later in the day and it is likely to approve a 4 per cent hike in dearness allowance (DA) for central government employees. Earlier, it was speculated that the Central government may increase the DA before Holy considering the general election scheduled in the coming months.
Total DA Hike to Touch 50%
With the latest 4 per cent DA hike, dearness allowance and dearness relief will increase to 50 per cent. It should be noted that the DA and DR are hiked twice a year with effect from January and July. The hike in DA and dearness relief (DR) is however decided by the central government on the basis of the All-India CPI-IW data.
When last time, the DA was hiked in October 2023, the DA was increased by 4 per cent to 46 per cent.
50 Lakh Govt Employees To Benefit
The decision to hike DA is expected to benefit the existing 50 lakh government employees and 62 lakh pensioners under the central government. After the cabinet approval, the suggested DA hike will be effective from January 1, 2024.
Last year, the Centre government approved Diwali bonuses for Group C and non-gazetted Group B level officials, including paramilitary forces. It should be noted that for the financial year 2022–2023, the Centre had fixed Rs 7,000 limit for the computation of non-productivity linked bonuses (ad hoc bonuses) for central government employees.
How DA Hike is Calculated
The Central government employees must note that Dearness Allowance (DA) is a cost-of-living adjustment allowance which is being given by the government to Central government employees and pensioners to mitigate the challenges of price rise and inflation.
The DA hike is calculated as a percentage of the basic salary. For example for the Central Government employees: Dearness Allowance percent = ((Average of AICPI (Base Year 2001=100) for the past 12 months -115.76)/115.76) *100.
Will Other Allowances Increase?
With 4% DA hike, the total DA will reach 50% this time and if the DA hits 50%, certain other allowances and components of the salary will also increase. Check full list here:
- House Rent Allowance
- children’s education allowance
- Special Allowance For Childcare
- Hostel Subsidy
- Transportation Of Personal Effects
- Gratuity
- Dress Allowance
- Mileage Allowance For Own Transport
- Daily Allowance
How Much HRA Will Increase?
In general, the central government employees get House Rent Allowance (HRA), depending on the category of the city they live in. As per the recommendations of the 7th Pay Commission, HRA has been rationalised to 24%, 16% and 8% of the basic pay for class X, Y and Z cities, respectively, from July 1, 2017. It should be noted that when the DA hike touched 25%, rates of HRA were revised to 27%, 18% and 9% of basic pay in X, Y and Z cities.