7th Pay Commission: In the latest development related to the commission, it has been reported that the center may announce the second hike in dearness allowance (DA) and dearness relief (DR) for employees and pensioners in the first week of September. Statistically, DA and DR are expected to increase by 3 percent this time, reports Financial Express. DA is given to serving government employees, while DR is given to retirees.
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7th Pay Commission: Hike up to 25%
Dearness Allowance and Dearness Relief are increased twice a year and they were announced by the government in March and September, respectively. However, this increase is implemented retrospectively in January and July every year.
In early January this year, the DA was raised by 4% to bring it to 50% of the base level. As a result of the DA reaching 50% of the base level, other allocations also saw an increase of up to 25%.
7th Pay Commission: DA hiked by 3%
DA is expected to increase by 3% for the period July to December 2024. While it is generally believed that the dearness allowance for government employees will increase by at least 3% for retirees, The government pays DA to serving employees in the respective government departments and DA to retirees. The increase in DA is calculated based on the All India Consumer Price Index (AICPI), which tracks changes in retail prices across various sectors.
7th Pay Commission: Calculation
The DA hike was first calculated based on the Consumer Price Index for the base year 2001. However, this was replaced by a new consumer price index with a base year of 2016 for calculating DA in September 2020. On August 2, there was news that the central government would increase DA by 3% in September from July 1, 2024.
Also Read: 7th Pay Commission: Government took a big decision regarding increase in DA, see latest update