7th Pay Commission: Central government employees could get 3% DA hike soon, here’s how to calculate DA hike

New Delhi: A few days ahead of the upcoming festive season, Central government employees are in for a treat again. This time the central government employees and pensioners are likely to receive another hike in dearness allowance (DA) and dearness relief (DR). 

The decision will come after the Central government recently restored the dearness allowance of employees. The DA was restored from 17% to 28% by the Central government, with the hike applicable from the salary of July 2021 onwards. 

The Central government has also increased the House Rent Allowance (HRA) from 24% to 27%. Now, there could be another good news for Central government employees and pensioners. 

The Centre could soon announce a further 3% hike in the DA and DR. With the speculated hike, the DA will be increased to 31% of the basic salary. 

Employees unions are also expecting that the government is likely to make the official announcement soon. AICPI data also suggests that DA is payable at a 31% rate, as the index for June 2021 increased by 1.1 points, reaching 121.7. 

The hike in DA, which will be for the first half of 2021, is expected to be announced in the month of September. However, there hasn’t been much update on when the government is actually planning to announce the increase in DA. 

The increased DA, if announced in September, can come with the salary of October, suggest media reports. Employees unions, however, are of the view that the government should include the DA hike with September’s salary as well. 

How to calculate the DA hike? 

If the government increases dearness allowance by 3%, then DA will be fixed at 31% of the basic salary. So, for calculating the DA hike, Central government employees will need to find 3% or 31% of their basic pay to calculate the hike and total DA amount, respectively. Also Read: Telecom, IT shares lift Sensex, Nifty to all-time highs

For instance, if an employee’s basic pay is Rs 20,000, then 3% of the salary would be Rs 600. So, the employee will receive Rs 600 more. Overall DA at 31% would be Rs 6200 in this scenario. Also Read: Big boost for telecom players! Cabinet approves 4-year moratorium on AGR dues, 100% FDI