7th Pay Commission DA Hike: There is good news for central employees. The calculation of their dearness allowance (DA Hike Calculation) will change from July 2024. But, it is important to understand why this is happening and how this is good news.
Central government employees are currently getting 50 percent dearness allowance (DA). This is applicable from January 2024. The next hike in dearness allowance will be applicable from July 2024. However, it may be September by the time it gets approved. But, it will be implemented from July only. Now let us understand what will happen if the calculation is changed.
Calculation will start from 0
The AICPI index numbers that determine the Dearness Allowance (DA) score are to be released between January and June 2024. Of these, only the data for January 2024 has been revealed so far. These numbers will decide how much the dearness allowance of central employees will increase. If the dearness allowance is 50 percent, the calculation of dearness allowance which will be zero (0) will change. This calculation will start from 0 and the increase that occurs, for example 3-4 percent, will be counted further. According to Labor Bureau sources, the calculation is certain to change. However, answers to all the questions will have to wait till July 31, 2024.
Dearness allowance is decided from AICPI numbers
According to the 7th Pay Commission, dearness allowance for central employees is decided by the AICPI index i.e. CPI (IW). The Labor Bureau issues it on the last working day of every month. However, this data is delayed by one month. For example, the data for January comes at the end of February. The index numbers decide how much the dearness allowance will increase. A formula has been given for determining dearness allowance. For Central Government employees, the formula is [(Average of All India Consumer Price Index (AICPI) of last 12 months – 115.76)/115.76]×100. In this the bureau collects data on many items. On the basis of this the index number is decided.
Labor Bureau did not release data for 2 months
For calculation of CPI for industrial workers, AICPI number will be released on the last working day of every month. The event calendar for this has already been released. According to this, the CPI number for January was released on 29 February. The CPI number for February was to be released on March 28. But, it was not given. There itself. Even the March numbers were not released on 30th April. It is being told that the Labor Bureau does not have the numbers for February.
Therefore no further calculations have been done. The intention is also that after collecting all the data before July, it should be released finally. The numbers for the month of June will be released on 31st July. This number itself will decide how much dearness allowance should increase in comparison to the increase in inflation in six months.
Delay in releasing February numbers
If we look at the current situation, till January the CPI (IW) number is at 138.9 points. Due to this, dearness allowance has increased to 50.84 percent. This will be counted as 51 percent. According to estimates, this figure may reach 51.42 in February. Experts are estimating that the next hike in dearness allowance will also be of 4 percent only. But, it is too early to say whether it will be given 4 percent or 54 percent.
How will employees get good news?
Experts clearly believe that it is not yet clear whether dearness allowance will be reduced to zero or not. Only when the final numbers come in July, the situation will be clear whether it will be reduced to zero or the calculation will continue beyond 50. It will completely depend on the government as to how and from where the dearness allowance will be calculated. But, meanwhile, the good news we were talking about is that as soon as it becomes zero, 50 percent of the dearness allowance money will itself be merged into the basic.
Minimum salary will increase by Rs 9000
If the calculation of dearness allowance starts from 0 from July, then the salary of central employees will increase by Rs 9000. This increase will be calculated on the minimum salary. If the basic salary of a central employee is Rs 18000, then his salary will increase to Rs 27000. Similarly, if the salary of an employee is Rs 25000, then his salary will increase by Rs 12500. This will happen because, once the dearness allowance is cancelled, it will be merged into the basic salary. However, the last time dearness allowance was reduced to zero was on January 1, 2016. At that time the recommendations of the 7th Pay Commission were implemented.
