In a significant development for millions of central government employees, the reports say that Dearness Allowance (DA) is possibly getting increased to 56% within the framework of the 7th Pay Commission. It’s really going to be a boon for employees and pensioners exposed to rising inflation and living standards.
Currently, 50% DA is given to central government employees following the last revision made earlier this year. Now, in the wake of the entirely rising inflation indices like the All India Consumer Price Index (AICPI), the government will come out with another incremental awarding of DA. If allowed, this raises that DA ceiling to 56% in total because of a 6% increase.
DA Hike Update
The announcement of DA hike is made twice a year, that is in January and July, to cushion ground of employees from inflation. Now, if sources are to be believed, the announcement will come by July 2025 and the implementation of the new rates will also have arrears from July onward.
Thus, this increase will benefit more than 50 lakh central government employees. It will also do much good to about 65 lakh pensioners, whose Dearness Relief (DR) is dependent on DA hikes.
To Sum It Up:
- Effective From: Most probably effective from July 1, 2025.
- Amount of Hike: DA will increase from 50% to 56%.
- Beneficiaries: Employee and pensioner, central government.
- Mode of Payment: Likely includes arrears for July, August, and probably September, depending on the date of announcement.
7th Pay Commission Calculation Formula
Dearness allowance is based on the 7th Pay Commission formula and involves a 12-month average of the AICPI. The new hike is going to timely come and be necessary since increasing inflationary conditions will induce the government to give this relief to its employees.
As per experts, once DA crosses the 50% threshold, salary components like House Rent Allowance (HRA) and Transport Allowance (TA) automatically get revised. Therefore, the employees might get to enjoy higher pay packages other than the DA hike.
Conclusion
The announcement of the new rates of DA will most probably take place by the centre soon after receiving the final inflation data for the first half of 2025.
Stay tuned to get the official updates as the Centre prepares to put a happy smile on the faces of millions of its employees and pensioners!
Also Read: 8th Pay Commission Launching In 200 Days: Big Salary Hike For Govt Employees