July 2019 DA: 5% DA hike confirmed as June 2019 AICPIN data out; When will new DA reflect in salary

New Delhi, Aug 10: July 2019 DA or Dearness Allowance would be 17 %. DA for July-December 2019 period would be 5% more from DA for January to June, 2019, period when it was 12%. 5% DA hike was confirmed after the June 2019 AICPIN data was released. AICPIN for June 2019 is 316 which is two points more that May 2019 AICPIN which was 314. The new July 2019 DA is likely to reflect in the October 2019 salaries of Central Government employees.

This is the biggest increase in the DA since the implementation of the 7th pay commission in 2016. AICPN for five months from January 2019 to May 2019 was already available. June 2019 inflation figure was awaited to complete the calculation of additional DA percentage from July 2019. With this increase in AICPIN, the Central Govt. Employees will get 5% increase in Dearness Allowance with effect from July, 2019 in 7th CPC Pay structure.

This increase is likely to be approved by the Union Cabinet in September,2019 and the revised DA would reflect in October, 2019, salary with arrears for the month of July, August and September,2019. Central Govt. Employees who are drawing their pay in pre-revised 6th CPC pay structure will get 10% increase in Dearness Allowance w.e.f. July, 2019 at the rate of 164%, which is currently 154%.

DA is a variable component in a government employee's salary which changes according to inflation or Consumer Price Index.DA is calculated on the basis of average factor of AICPIN or All India Consumer Price Index.DA is revised twice every year. DA component in salary from January to June is calculated on the basis of previous year's July-December average AICPIN, while July-December takes into account January-June average AICPIN of the same year.

DA calculation formula:

For January 2019 AICPIN was 307, February 2019 AICPIN was 307, March 2019 AICPIN was 309,April 2019 AICPIN was 312, May 2019 AICPIN was 314 and June 2019's is 316.

The DA calculation formula: Percentage of Dearness Allowance = (Average of AICPN for last 12 months) - 261.42 x 100 / 261.42.

Ministry of Labour and Employment releases All India Consumer Price Index (AICPIN). Now, since it keeps varying, a 12 months average factor is taken for DA calculation.

The calculation method of Dearness allowance has not changed since the implementation of 7th Pay Commission which came into effect from January 1, 2019. What, however, changes is months average factor. In 6th Central Pay Commission, the average factor was 115.76 and now the factor is 261.42.