7th Pay Commission: Here's When Centre Will Announce DA Hike For Govt Employees

For over a month, the government employees have been eagerly awaiting for the Centre to announce the next dearness allowance (DA) hike.

A few weeks ago, it was reported that the Centre will announce good news for over one crore central government employees and pensioners in September. Now, the latest update is that the Centre will announce the DA hike in the third week of this month.

"The Central government employees could expect DA hike only in the third week of September. And this time, the Centre could announce only a 3% hike in dearness allowance as the inflation is steadily coming under control," a website quoted an official in the Ministry of Finance as saying.

The same source has stated that the DA hike will come to effect from July 1.

According to a PTI report, the government is likely to increase the dearness allowance (DA) by three percentage points to 45 per cent from the existing 42 per cent as per the agreed formula for the purpose.

"The CPI-IW for June 2023 was released on July 31, 2023. We are demanding a four percentage point hike in dearness allowance. But the dearness allowance hike works out to be a little over three percentage points. The government does not factor in hiking DA beyond the decimal point. Thus DA is likely to be increased by three percentage points to 45 per cent," PTI quoted All India Railwaymen Federation General Secretary Shiva Gopal Mishra as saying.

Additionally, he elaborated that the Finance Ministry's expenditure department will create a proposal outlining the increase in Dearness Allowance (DA) along with its financial impact. This proposal will then be presented to the Union Cabinet for approval.

The calculation of dearness allowance for both employees and pensioners are done on the most recent Consumer Price Index for Industrial Workers (CPI-IW), which is published by the Labour Bureau on a monthly basis.

The last revision in DA was done on March 24, 2023, and was effective from January 1, 2023.

The Centre had increased DA by four percentage points to 42 per cent based on the percentage increase in the 12 monthly average of the All India Consumer Price Index for the period ending December 2022.

The DA is provided to employees and pensioners to compensate them for rising prices.

The cost of living increases over a period of time and is reflected through CPI-IW. The allowance is revised periodically twice a year.