DA Hike 7th Pay Commission: Central government employees are likely to get some good news from the government regarding the increase in their salary. By the next month, i.e. July, Central Government employees and pensioners can get updates about their Dearness Allowance or DA Hike, which is reportedly on the cards of the government. According to several media reports, the Center is likely to implement another DA hike for government employees On July 1, which is the following month.
7th Pay Commission DA Hike: How Much Will It Increase?
The government revises the DA in January and July based on the All India Consumer Price Index (AICPI). In January this year, the government had announced an increase in dearness allowance and dearness relief. 7th Pay Commission, DA and DR of employees and pensioners increased by 3 percent. According to a report in Moneycontrol Hindi, this time in the months of April, May and June, if the AICPI is above 126, the DA may increase by 4 per cent. The AICPI in January and February stood at 125.1 and 125 respectively, while it rose to 126 in March. Now, if AICPI stays at that level, DA is expected to increase by 4 per cent.
Presently government employees get 34 per cent DA on their basic pay. If the DA hike of 4 per cent is implemented, they are going to get 38 per cent dearness allowance on top of their basic pay. Dearness Allowance (DA) is given to government employees, while Dearness Relief (DR) is given to pensioners.
How much will the salary increase after increasing DA?
After the latest reported hike, central government employees will get 38 per cent dearness allowance calculated by multiplying the current rate of DA by the basic pay of the employee. Explain that this calculation is done against the salary of an employee whose basic salary is Rs 18,000. At present, the employee is getting DA of Rs 6,120 at the rate of 31 per cent DA. If the fresh DA hike in July is implemented at 4 per cent, the employee will get DA of Rs 6,840. This means that Rs 720 will be increased after the latest DA hike.
To reduce inflation, the government increases DA in January and July every year. Therefore, since retail inflation is at a one-year high, there is a strong possibility of a hike in dearness allowance. CPI-based inflation stood at an eight-year high of 7.79 per cent in April.
It is to be noted that Dearness Allowance varies from employee to employee depending on whether they work in urban area, semi-urban area or rural area. At present, central government employees get 34 per cent DA, which was increased from 31 per cent in January to 3 per cent.
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