DA hike will be in accordance with the accepted formula, based on the recommendations of the 7th Central Pay Commission.
7th Pay Commission: The government is expected to hike Dearness Allowance (DA) by 4 percent for central government employees in March 2024, as per various media reports.
The DA for employees and pensioners is worked out based on the latest Consumer Price Index for Industrial Workers (CPI-IW) brought out by the Labour Bureau every month.
The dearness allowance is revised twice a year — in January and July. The announcement is made public in March mostly. The DA hike will be applied with effect from January 1, 2024. This means government employees and pensioners will get arrears for previous months.
The calculation of the increase in dearness allowance in July 2024 (DA Hike Calculation) will be done using a new method or rather a new formula. There is a reason behind this, in fact after reaching 50 percent dearness allowance will be reduced to zero.
Central employees are currently getting 46 percent dearness allowance. It is clear from the recent AICPI index data that this time also DA has increased by 4%. However, it is yet to be approved by the Union Cabinet. Employees will get the benefit of increased DA from April salary. But, it will be implemented from January 1, 2024.
After January, the next DA hike will be in July 2024. There may be changes in the calculation of this dearness allowance. Because, after the 50 percent dearness allowance, it will be reduced to zero and the calculation of the new dearness allowance will start from 0.
Dearness Allowance: How to calculate on your salary
For govt employees: DA is calculated as -- {(Average of the All-India Consumer Price Index (Base year -2001 =100) for the last 12 months -115.76)/115.76} x 100.
For central public sector employees, the DA is calculated as --- {(Average of the All-India Consumer Price Index (Base year -2001 =100) for the last 3 months -126.33)/126.33} x 100.
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