7th Pay Commission: Dearness allowance will increase by 4 percent of central employees! Know how much your salary will increase
7th Pay Commission: The Central Government may soon increase Dearness Allowance (DA) and Dearness Relief (DR) for central employees and pensioners. To fight the rising inflation, the central government increases the dearness allowance from time to time. It is usually revised twice every year in January and July and the hike is announced usually in the month of March.
Know on what basis the calculation is done
DA for central government employees is calculated on the basis of the latest Consumer Price Index for Industrial Workers (CPI-IW). The Labor Bureau, a branch of the labor ministry, publishes CPI-IW data every month. There is a prescribed formula for calculating the dearness allowance of central government employees and pensioners. According to this, the Central Government is likely to increase the dearness allowance to 42 percent. At present, central government employees and pensioners get 38 per cent dearness allowance and dearness relief respectively.
About 4 percent growth expected
The last DA hike was announced by the central government on September 28, 2022, which was effective from July 1, 2022. At the same time, this time the expected increase in DA and DR will be around 4 percent which will take the overall DA and DR to around 42 percent. This DA hike will be effective from January 1, 2023. DA is calculated as a proportion of the basic pay. Every government employee and pensioner gets dearness allowance and dearness relief.
Salary will increase this much per month
For central government employees, the increase in DA increases their take-home salary. For example, a central government employee gets a basic salary of Rs 25,500 per month. His dearness allowance at 38 per cent was Rs 9,690. Now if DA increases to 42 per cent, then his DA will increase to Rs 10,710. So with the latest increase, his salary will increase by Rs 10,710-9,690 = Rs 1,020.
Retired central employees also benefit
Retired central employees also get dearness relief. This is similar to the DA applicable to central government employees. Dearness relief is also likely to increase by 4 percent soon. With the increase in DR, there will be an increase in the monthly pension of the Central Government pensioners. Suppose a basic pension of Rs 35,400 per month is received on the pension of the Central Government. At 38 per cent dearness relief, the pensioner now gets Rs 13,452. If his DR increases to 42 per cent, he will get Rs 14,868 per month. Keep in mind that these changes will be applicable to central government employees and pensioners with retrospective effect from January 1, 2023.