7th Pay Commission: The Central government might increase the dearness allowance from 42 percent to 45 percent, effective from July 1.
7th Pay Commission Latest News: As crores of government employees are waiting for salary hike ahead of the festive season, the Centre could announce a hike in the dearness allowance (DA) on Wednesday. If it is announced, it will be a perfect pre-Navratri gift for the central employees and pensioners. During a cabinet meeting conducted by Prime Minister Narendra Modi, an approval for hike in the dearness allowance is expected today, says a report by DNA.
DA Hike Announcement Likely Today
Both the Union Cabinet and the Economic Affairs Committee are holding meeting on Wednesday and it is expected that the Central government may hike the dearness allowance for central employees and pensioners during the meeting.
The decision from the Centre is crucial because the Election Commission may announce the dates for assembly elections in five states at any time. After EC announces the dates, the code of conduct will come into effect, making it challenging for the government to make this decision.
DA Hike Likely by 3%
The Central government employees and pensioners are for a long time waiting for a dearness allowance increase since July. This time, the Centre might raise the dearness allowance from 42 percent to 45 percent, effective from July 1. After the DA hike, the salary for October is expected to include the dearness allowance, and arrears for the period from July to September.
Navratri festival will start from October 15 and Dussehra on October 24. Hence, it is expected that the decision to increase the dearness allowance for central employees and pensioners will be made on Wednesday. This DA hike from the Centre will benefit 47 lakh employees and 68 lakh pensioners, providing them with relief from the burden of rising inflation.
How DA is Calculated?
The formula to increase DA is based on the latest Consumer Price Index for Industrial Workers (CPI-IW). Notably, the DA is given to government employees, while DR is given to pensioners.
The Central government employees must be knowing that the DA and DR are hiked twice a year — January and July. Right now, over one crore central government employees and pensioners are getting a 42 per cent dearness allowance.
When DA was hiked in March 2023, it was increased by 4 per cent to 42 per cent. Given the current inflation rate, the next DA hike is expected to be 3 per cent this time.