Anticipated in March, the Dearness Allowance (DA) for Central government employees is poised to witness a four per cent hike. It is set to be implemented retrospectively from 1 January, 2024. Consequently, the DA for the period from January to March will be disbursed as arrears.
This allowance is specifically designated for government employees, while pensioners receive Dearness Relief (DR). The adjustment of DA occurs biannually, typically in January and July, with official announcements commonly made in March.
The prescribed formula, rooted in the recommendations of the 7th Central Pay Commission, will be adhered to for the impending DA increase. The most recent adjustment was made in October 2023, when the cabinet increased DR for pensioners and DA for government employees by four per cent, elevating the DA from 42 per cent to 46 per cent.
As per the news, the dearness allowance and relief will go up to 50 person cent after the expected four per cent increase this time. This is connected to the average Consumer Price Index for Industrial Workers (CPI-IW), which was 392.83 over 12 months. In simpler terms, this means that the DA makes up 50.26 per cent of the basic salary. The formula for calculating DA per cent is based on the average All India Consumer Price Index (AICPI) for the past 12 months, subtracting 115.76, dividing by 115.76, and then multiplying by 100.
For instance, if the average of All India Consumer Price Index (AICPI) for the past 12 months is 125.00, the DA will be = (9.24 / 115.76) * 100 ? 7.98 per cent.
Notably, the UP government also approved a 10 per cent rise in DA, bringing the total to 38 per cent for employees in the roadways sector. This adjustment is set to benefit approximately 12,000 workers. Another state taking such measures is West Bengal, where the government has increased the DA for state employees by four per cent.
