The buzz around increase in dearness allowance by up to 3 percent gained further momentum after the announcement of All India Consumer Price Index and after the presentation of the Union Budget 2022.
New Delhi: The Modi government may bring some more good news for the central government employees before Holi. The announcement on dearness allowance (DA) hike under the recommendation of 7th Pay Commission is expected before the festival of colours.
The buzz around increase in dearness allowance by up to 3 percent gained further momentum after the announcement of All India Consumer Price Index and after the presentation of the Union Budget 2022.
It has been widely reported in the media that the Modi government may increase dearness allowance by up to another 3 percent, leading to a substantial hike in the salary of the central government employees. In further cheer to 50 lakh central government employees and 61 lakh pensioners, the government will also make announcements regarding hike the House Rent Allowance (HRA), reported Zee Hindi website.
Read more:7th Pay Commission: Here’s the big update on fitment factor, minimum wages set to be hiked?
The government’s announcement on DA hike will be based on the recommendation of the 7th Pay Commission. At present, central employees get DA of 31 percent, and hence a further increase of DA by 3 percent, will take the total DA to 34 percent. In the aftermath of the COVID-19 crisis, all eyes are fixed on the government’s announcement. Dearness Allowance is calculated by multiplying it by the basic salary. As per the calculation of Dearness Allowance, the government keeps changing the DA after every 6 months or so, which in result increases the salary of the employees so as to tackle inflation. In October last year, DA was increased from 28 percent to 31 percent.
Impact on House Rent Allowance
HRA is paid @24 percent, 16 percent and 8 percent for X, Y & Z cities respectively. HRA not to be less than Rs 5400, Rs 3600 and Rs 1800 for X, Y and Z cities, calculated @30 percent, 20 percent and 10 percent of basic pay of Rs 18,000. But this however is only possible when DA will be beyond 50 percent. Because according to the old order of the government, if the DA crosses 50 percent, then the HRA will be 30 percent, 20 percent and 10 percent.
