Good news for Central Govt employees: DA likely to hike again by 3 per cent

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Good news for Central government employees as the government is likely to hike their Dearness Allowance (DA) and Dearness Relief (DR) ahead of the upcoming festive season.

As per reports, the Central government may hike the DA rates for both employees and pensioners by another 3 percent ahead of the festive season.

The central government employees will get the DA hike in accordance with the accepted formula which is based on the 7th Central Pay Commission.

The Central government may announce the DA hike soon as it had already restored the DA of employees.

Previously, the government hiked the DA from 17 per cent to 28 per cent which will be applicable on employees’ salaries from July, 2021 onwards. In addition, the government had also hiked up the employees’ House Rent Allowance (HRA) from 24 per cent to 27 per cent.

If the DA and DR really hiked again by another 3 per cent, then the total DA would be around 31 per cent against their basic salary in the near future.

In January last year, the government increased the Dearness Allowance by 4 per cent, which was followed by another 3 per cent hike in June of that same year. The central government employees saw yet another hike in January of 2021 where the DA once again went up by 4 per cent.

The employees’ unions are expecting the central government to make the announcement soon. AICPI data suggested that the DA is payable at a 31 per cent rate given that the index for June 2021 increased by 1.1 points, which leaves the final number at 121.7.

The DA hike is expected to be announced sometime in the month of September 2021 and will likely to be applicable in the first half of 2021. However, there is no indication of another DA hike from the side of the government yet.

According to media reports, if the DA hike is announced this month then it will most likely be payable with the salary of October. However, employee unions has suggested that the government should include the DA hike with the salary for September as well.

Nearly 48 lakh central government employees and around 65 lakh pensioners will benefit from this hike.

Earlier, the Centre also hiked the Variable Dearness Allowance (VDA). This put it in a range of Rs 105 to Rs 210 per month which had been effective from April, 2021. The VDA hike was aimed to benefit around 1.5 crore workers.

All the DA hike are announced after the government put a temporary hold on the DA for around 18 months due to the Covid-19 pandemic. Apart from the central Government, various state government also increased their DA rates up to 11 per cent for their government employees. These states include Uttar Pradesh, Jammu and Kashmir, Jharkhand, Haryana, Karnataka, Rajasthan and most recently, Assam.

You can calculate the DA Hike this way

If the government really hike the DA by 3 per cent and increases it up to 31 per cent of the basic salary. Employees and pensioners simply need to find the equivalent percentage of their basic salary to get the DA amount that they would receive.

For example, if an central govt employee gets an basic salary of Rs 20,000 per month, then 3 per cent of that would be around Rs 600. So, the employee would get an additional Rs 600 in addition of the basic salary of Rs 20,000. If we count the total hike which will be 31 per cent, then 31 per cent of Rs 20,000 would be Rs 6,200.

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