7th Pay Commission Dearness Allowance Hike Date, Latest News (August 25): Central Government Employees and pensioners are expected to get a 3% hike in Dearness Allowance (DA) and Dearness Relief (DR) rates
7th Pay Commission Dearness Allowance Hike Date, Latest News (August 25): Central Government Employees and pensioners are expected to get a 3% hike in Dearness Allowance (DA) and Dearness Relief (DR) rates in the second half of 2023. But when will the Government announce increased rates?
DA Hike Date: Various reports have recently said that the decision on the DA/DR rate hike is likely to be announced next month i.e. September 2023.
DA/DR is provided as a relief measure to cut down the impact of inflation on the value of the in-hand salary/pension provided to Government employees and pensioners. The DA/DR hike is announced as per the formula recommended by the 7th Pay Commission.
Read More: LIC Saral Pension Plan: Eligibility criteria, benefits and how to apply
Why a 3% hike in DA/DR is expected?
The retail inflation in India hit a 15-month high in July. As per the AICPI-IW data for June 2023, the dearness allowance hike works out to be a little over 3 percentage points. However, the Government doesn’t consider hiking DA/DR above the decimal point. Hence it is expected that a 3% hike in DA will be announced next month.
If the Government announces a 3% hike then the DA rate for Central Government Employees will jump to 45% while the DR rate for pensioners will also increase to 45%.
Read More: Loan Against Mutual Funds: Key Things To Know, Check Advantages Now
The next DA hike announcement will be effective from 1st July 2023. The Government revises the DA/DR rate on a half-yearly basis and any hike, if announced, is implemented from 1 January and 1st of July respectively. Generally, DA hike is announced one to three months after July. However, arrears for the previous months are provided to employees and pensioners.
The final decision of the DA hike will be taken by the Union Cabinet chaired by the Prime Minister.
Who will benefit?
There are over 1 crore Central Government Employees and pensioners who will benefit from the next round of DA/DR hikes. In March 2023, the DA/DR rate was increased by 4% from 38% to 42%. The next hike, when announced, may take this rate to 45%.
