7th Pay Commission: Will the government give a shock before the 8th Pay Commission? Till now it was believed that the government could increase dearness allowance by 3 to 4 percent in March. Now if media reports are to be believed, the government will increase Dearness Allowance (DA) by only 2 percent before Holi
7th Pay Commission: Will the government give a shock before the 8th Pay Commission. Till now it was believed that the government could increase dearness allowance by 3 to 4 percent in March. Now if media reports are to be believed, the government will increase Dearness Allowance (DA) by only 2 percent before Holi.
DA may increase before Holi
This increase in Dearness Allowance (DA) happens twice a year in January and July. According to the inflation rate, DA is expected to increase by 2% in the salary of central government employees. This will increase the dearness allowance from 53% to 55%. However, the final decision on this will be taken in the cabinet meeting to be chaired by Prime Minister Narendra Modi. Earlier in October 2024, central government employees got a DA hike of 3%, which was considered effective from July 1, 2024. After that increase, DA increased from 50% to 53%. Similarly, pensioners also got a similar increase in Dearness Relief (DR).
How much will the salary increase due to DA hike?
If there is a 2% increase in DA, then the salary of an employee with a basic salary of Rs 18,000 will increase by Rs 360 per month. If the total salary of an employee is Rs 30,000 and his basic salary is Rs 18,000, then he currently gets 53% DA i.e. Rs 9,540. But after a 2% increase, he will get Rs 9,900 per month, which will be Rs 360 more. If DA is increased by 3%, then DA will increase by Rs 540 to Rs 10,080 per month.
How is DA decided?
Dearness Allowance (DA) and Dearness Relief (DR) are calculated based on the average increase in the All India Consumer Price Index (AICPI) of 12 months. The central government revises DA every year on January 1 and July 1, but it is usually announced in March and September.
In 2006, the central government adopted a new formula for calculating DA and DR.
Formula to calculate DA percentage
Dearness Allowance (DA) percentage = ((Average of All India Consumer Price Index (AICPI) of last 12 months – 115.76)/115.76) × 100
8th Pay Commission
In January 2025, the Central Government announced the 8th Pay Commission, which will revise the salaries and pensions of government employees. The period of the 7th Pay Commission is ending this year. However, the terms of reference (ToR) of the new Pay Commission and its members have not been announced by the government yet. The 8th Pay Commission will be implemented in 2026, as the period of the 7th Pay Commission is ending on 31 December 2025.
