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HomeEconomyIf the government increases DA, how much will the salary increase? MPNRC
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If the government increases DA, how much will the salary increase? MPNRC

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DA Hike 7th Pay Commission: The Indian economy is witnessing a sharp rise in retail inflation, which recently hit an eight-year high. Rising inflation means rise in prices, and consequently irritation in the pockets of the citizens of the country. To compensate for the effect of inflation, the government can announce another increase in the DA of central government employees under the 7th Pay Commission. The DA and DR are revised twice a year, usually in January and July, based on retail inflation data. According to several media reports, the Center is likely to implement another DA hike for government employees on July 1, which is next month.

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How much DA hike is expected?

According to a report by Zee News, the government may consider increasing the DA by 5 percent in July. This means that if the report is to be believed, then the central government employees will get 39 percent DA. The AICPI in January and February stood at 125.1 and 125 respectively, while it rose to 126 in March. The AICPI rose to 127.7 in April, due to rising inflation. Now, if AICPI remains at that level, the DA is likely to increase by 5 per cent. CPI-based inflation stood at an eight-year high of 7.79 per cent in April.

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Presently government employees get 34 per cent DA on their basic pay. If 5 per cent hike in DA is implemented, they are going to get 39 per cent dearness allowance over the basic pay. Dearness Allowance (DA) is given to government employees, while Dearness Relief (DR) is given to pensioners. The government had revised the DA in March this year, which then increased by 3 per cent to 34 per cent of an employee’s basic pay. This was done because of rising prices, and the central government increased the DA by 3 per cent to compensate for inflation. April AICPI has fueled rumors that the government may consider a 5 per cent hike in DA in July.

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DA Hike 7th Pay Commission: Salary Calculation

According to the notice of the Department of Expenditure, if the basic pay of an employee is Rs 18,000, he will get dearness allowance of Rs 6,120 after the latest hike implemented in April. Earlier, the employee was getting Rs 5,580 DA at the rate of 31 per cent DA. This would mean that there has been an increase of Rs 540 after the latest DA hike. If the DA is increased by another 5 per cent, i.e. if the employee gets 39 per cent DA on the basic salary of Rs 18,000, then the DA will be Rs 7,020. This means that if 5 per cent hike in DA is implemented, the salary will increase by Rs 900.

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