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Central government employees and pensioners may be in for a treat soon, as the Centre is considering a 4% hike in Dearness Allowance (DA), according to a report by CNBC TV18. While there is no official announcement yet, the hike is likely to be effective from July 1, 2023.
The DA hike will lead to a significant increase in salary for central government employees. The DA is calculated as a percentage of the basic salary, and the current formula is:
Dearness Allowance percent = ((Average of AICPI(BASE Year 2001=100) for the past 12 months -115.76) / 115.76)* 100
For an employee with a minimum basic salary of Rs 18,000, the current DA at 42% provides a monthly increase of Rs 7,560. With a 4% hike in DA, this monthly increase will go up to Rs 8,640.
The announcement of the DA hike is expected in October 2023. This news is a welcome relief for central government employees and pensioners, who have been waiting for a DA hike for some time now. The DA hike will help to cushion the blow of rising inflation and improve their standard of living.
