DA Hike 7th Pay Commission: The government is likely to bring in some more good news for central government employees. Under the 7th Pay Commission, the Union government led by Prime Minister Narendra Modi, as per media reports, is likely to announce a hike in the dearness allowance for central government employees in the coming days. This will in turn increase their salary. The government is currently looking at a DA hike of 5 per cent, which may be implemented soon, to offset the impact of inflation. The DA and DR are usually revised twice a year in January and July, based on the retail inflation data.
However, this salary will be increased only on the basic pay of the employee. “The term ‘Basic Pay’ in the revised pay structure means the pay drawn in the prescribed Level in the Pay Matrix as per 7th CPC recommendations accepted by the Government, but does not include any other type of pay like special pay etc,” the Department of Expenditure (DoE) has said in the Office Memorandum (O.M.) data the last time DA was hiked.
“The Dearness Allowance will continue to be a distinct element of remuneration and will not be treated as pay within the ambit of FR 9(21),” the office memorandum further noted.
DA Hike 7th Pay Commission: Salary Calculation
Going by the department of expenditure’s notice, if an employee’s basic pay is Rs 18,000, he or she is getting Dearness Allowance of Rs 6,120 after the latest hike. At the rate of 31 per cent DA earlier, the employee was getting DA of Rs 5,580. This will mean that an increase of Rs 540 has been made after the latest DA hike. If the DA is increased by another 5 per cent, that is, if the employee gets 39 per cent DA on a basic salary of Rs 18,000, the DA will be Rs 7,020. This means that the salary will increase by Rs 900 if the DA hike of 5 per cent is implemented.
How is DA under 7th Pay Commission Calculated?
In 2006, the central government had revised the formula to calculate the DA and DR for central government employees and pensioners.
Dearness Allowance Percentage = ((Average of All-India Consumer Price Index (Base Year 2001=100) for the past 12 months -115.76)/115.76)x100.
For Central public sector employees: Dearness Allowance Percentage = ((Average of All-India Consumer Price Index (Base Year 2001=100) for the past 3 months -126.33)/126.33)x100.
Will the Government Sanction a DA Hike in July?
The government hikes DA every year in January and July to set off inflation. Therefore, since the retail inflation is at a years-high, the chances of a hike in dearness allowance are also strong. It must be noted that Dearness Allowance varies from employee to employee based on whether they work in urban sector, semi-urban sector or the rural sector.
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