DA Hike: The Union Cabinet stated on October 18, 2023, that the Dearness Allowance (DA) for central government employees and the Dearness Relief (DR) for central government pensioners had both increased by 4%. The most recent rise will bring DA for central government employees and DR for retirees to 46%.
Around 48.67 lakh central government employees and 67.95 lakh central government pensioners will profit from this decision. Employees and retirees of the central government will be subject to DA and DR beginning on July 1, 2023.
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Central government employees DA hike 2023
In order to offset price increases, the Union Cabinet, which is presided over by Prime Minister Shri Narendra Modi, has decided to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners beginning on July 1, 2023. This represents an increase of 4% over the current rate of 42% of the Basic Pay/Pension. The Union Cabinet stated in a release that this rise is in compliance with the recognised formula, which is based on the suggestions of the 7th Central Pay Commission.
The central government occasionally raises the Dearness Allowance to lessen the effects of inflation. In January and July of each year, it is often amended twice. The most recent Consumer Price Index for Industrial Workers (CPI-IW) is used to determine the DA for central government employees. The last increase in the dearness allowance was to 42% beginning on January 1, 2023.
How much will my salary increase with a 4% DA hike?
A Dearness Allowance and Dearness Relief are provided to each government employee and pensioner. A percentage of the basic income is used to determine the Dearness Allowance. The raise in Dearness Allowance (DA) will benefit individuals who are central government employees, retirees, and recipients of central government pension schemes.
A rise in DA raises central government employees’ take-home pay. A federal government worker, for instance, receives a base wage of Rs 39,900 per month. His dearness allowance was Rs 16,758 at a 42% rate. His DA will increase to Rs 18,354 as DA increases to 46%. Thus, starting on July 1, 2023, his pay would increase by Rs 1,596 per month as a result of the most recent rise.
DR increase for pensioners in 2023
Pensioners from the central government are eligible for dearness relief, which is comparable to the DA offered to central government employees. 4% more dearness relief has also been given. The monthly pension for retired central government employees would rise along with an increase in DR. A central government retiree, for instance, receives a basic pension of Rs. 40,100 each month. The pensioner used to receive Rs 16,842 at a 42% cost-of-living adjustment. Due to the enhanced DR of 46%, he will now receive Rs 18,446 each month. His monthly pension will therefore increase by Rs. 1,604.
These modifications will take effect retroactively on July 1, 2023 for central government employees and pensioners. The salaries of central government workers and pensioners are projected to increase starting in October, along with arrears beginning in July 2023.