Today, July 31, 2023, the labour ministry is set to announce the AICPI index as a result of which the central government will review various aspects of government employee salaries, including the dearness allowance (DA), fitment factor, dearness relief (DR), DA arrears, and other increments based on the AICPI index.
This marks the second time in 2023 that the government is planning to increase DA for its employees. At present, employees are receiving 42 per cent DA. The announcement will reveal the exact percentage by which the DA hike for central employees and dearness relief for pensioners will be increased.
The central government reviews and adjusts the DA and DR for pensioners every six months, relying on the AICPI index provided by the ministry of labour. These adjustments take effect in January and July of each year.
The AICPI index data has been released for five months, with June’s data still pending. Based on the available figures, it is anticipated that there may be a 4 per cent increase in the DA. However, the precise percentage of the increase will only be confirmed after the official announcement.
If the DA and DR is indeed increased by 4 per cent, it will be raised from 42 per cent to 46 per cent. It is worth noting that the central government previously increased the dearness allowance by 4 per cent around Holi, implementing it from January, resulting in a rise from 38 per cent to 42 per cent. This increase is expected to directly benefit approximately 47 lakh central government employees and 68 lakh pensioners.