7th Pay Commission DA Hike Latest News (August 8): While Central Government Employees are expected to get a 3% hike in their Dearness Allowance, this raise, if announced by the Centre, will not be on the expected lines.

Central Government Employees were hoping for a 4% hike in DA. More so because the dearness allowance rate as per the latest AICPI-IW data works out to be over 3%. (Read details here).

Currently, the central employees are getting 42% of their basic pay as DA while pensioners are getting 42% of their basic pension as Dearness Relief (DR).

A 4% hike would have taken the total DA/DR to 46%, putting more money in the hands of employees and pensioners money to battle the erosion of the value of their monthly pay due to a spike in inflation this year.

However, a recent report by the news agency PTI said that the central Government is likely to increase the dearness allowance by three percentage points to 45%. And there is a reason for this.

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The dearness allowance for employees and pensioners is calculated on the basis of the latest All India Consumer Price Index for Industrial Workers (CPI-IW) released by the Labour Bureau every month. The AICPI-IW data for the month of June 2023 was released on July 31, 2023.

According to All India Railwaymen Federation General Secretary Shiva Gopal Mishra, the DA hike as per AICPI-IW data works out to be a little over 3%. However, the government doesn’t factor in hiking the DA beyond the decimal point. This means the Government will most likely go for a 3% hike in DA/DR.

The Department of Expenditure under the Finance Ministry is now expected to formulate a proposal to hike DA along with its revenue implications. The proposal would be later put up before the Union Cabinet headed by Prime Minister Narendra Modi for final approval.

Central Government Employees and pensioners receive their salaries and pensions respectively as per the recommendations of the 7th Pay Commission. The announcement of DA/DR hike would benefit over 1 crore Central Government Employees and pensioners.