Good News on the Horizon
Good news is in store for Central Government employees and pensioners as the government is likely to announce an increase in the Dearness Allowance (DA). This periodic adjustment is aimed at mitigating the impact of inflation on salaried and pension-receiving individuals.
DA Revision Frequency
The Central Government reviews and adjusts the DA every year in January and July. Currently, government employees and pensioners are receiving a DA of 42%. With September halfway over and no announcement made yet, it is anticipated that the government may soon disclose the updated rates.
Calculation Methodology
The DA is calculated based on the most recent Consumer Price Index (CPI-IW). There is a fixed formula used for calculating the DA for Central Government employees and pensioners. According to July’s CPI data, it is expected that the government will increase the DA by 3%.
Increment Details: What to Expect
According to PTI sources, referring to Shiv Gopal Mishra, General Secretary of All India Railwaymen’s Federation, the hike in DA is expected to be slightly more than three percentage points. However, the government does not consider increments in fractions of a point, making it likely that the DA will increase from 42% to 45%.
Salary Implications
Assuming a Central Government employee receives a basic monthly salary of ₹36,500, their current DA at 42% amounts to ₹15,330. With a 3% increase effective from July 2023, the new DA would be ₹16,425, resulting in a salary hike of ₹1,095 per month.
| Parameter | Current Status | After 3% Hike |
|---|---|---|
| Basic Monthly Salary | ₹36,500 | ₹36,500 |
| Current DA (%) | 42% | 45% |
| Current DA (in ₹) | ₹15,330 | ₹16,425 |
| Monthly Salary Increment (in ₹) | N/A | ₹1,095 |
By increasing the DA, the government aims to offset the impact of inflation, thereby bringing financial relief to millions of its employees and pensioners.
