7th Pay Commission: Good news for central govt employees, DA may increase by...

Centre is likely to announce a 4 percent hike in dearness allowance (DA) in March 2024, according to media reports.

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Dearness Allowance (DA) of central employees is expected to rise by 4 percent in March. But, it will be executed from January 1, 2024. Therefore, dearness allowance from January to March will be paid as arrears. Dearness Allowance is given to government employees, while Dearness Relief (DR) is given to pensioners. The dearness allowance is revised twice a year — in January and July. The announcement is made public in March mostly.  

The accepted formula, which is based on the recommendations of the 7th Central Pay Commission, will be followed for the DA increase. The last time the Cabinet raised the Dearness Relief (DR) for pensioners and the DA for government employees was in October 2023. The four percent hike raised the DA from 42 percent to 46 percent. 

According to news reports, dearness allowance and dearness relief will rise to 50% following the 4% DA hike this time. The Consumer Price Index for Industrial Workers (CPI-IW) was 392.83 on average for 12 months. This means that DA represents 50.26 percent of base pay. 

Dearness Allowance percent = ((Average of AICPI (Base Year 2001=100) for the past 12 months -115.76)/115.76) *100 

UP CM Yogi Adityanath-led administration granted a 10% increase in dearness allowance earlier this month, bringing the total to 38% for roadways employees. The change will be advantageous to around 12,000 workers. The other state that has increased DA for its workers is West Bengal. The Dearness Allowance (DA) for state government employees has been increased by the state by 4%. 

Punjab CM Bhagwant Mann announced in December 2023 that government employees' dearness allowance would increase by 4%. With effect from December 1, the DA was raised from 34% to 38%, benefiting 3.25 lakh workers and 3.50 lakh pensioners in Punjab. 

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