DA Hike, Dearness Allowance Calculation: The long-drawn wait for central employees will finally be over soon, as sources have informed that the Modi government will soon announce a hike in Dearness Allowance. As per sources, a decision to hike DA by 4% will soon be notified.
As of now, all central government employees and pensioners are being paid DA and DR at the rate of 38% under the 7th Pay Commission. However, once the 4% DA Hike is notified, this amount will increase to 42%.
As per sources, dearness allowance will be paid at the rate of 42% in March salary and arrears of 2 months — January and February 2023 — will also be disbursed.
Central government employees can calculate the increase in their salary according to their basic pay and grade after the DA hike.
DA Hike: How much will Dearness Allowance increase?
As per sources, the incremented DA will be paid along with the salary for the month of March 2023. As known to all, dearness allowance is calculated only on the basic salary.
For example, if a government employee’s salary is Rs 20,000, then after a 4% DA hike, their salary will increase by Rs 800 a month.
DA Hike: Dearness Allowance Formula
A simple formula is used to calculate the dearness allowance of central government employees:
For them, the Dearness Allowance Hike Formula is – [(Average of All India Consumer Price Index (AICPI) for the last 12 months – 115.76)/115.76]×100.
Formula for calculating DA hike of PSU personnel:
Now, if we talk about the Dearness Allowance of people working in PSUs (Public Sector Units), then the method of calculation is – Dearness Allowance Percentage = (Average of Consumer Price Index for the last 3 months (Base Year 2001 = 100)-126.33))x100
According to the 7th Pay Commission matrix, there will be a massive increase in the salary of the officer grade.
DA Hike: How much will pension increase?
If the basic pension of a pensioner is Rs 31,550.
Then, Basic Pay – Rs 31,550
Dearness Allowance (DA) paid so far – 38% – Rs 11,989/month
New Dearness Allowance (DA) every month – 42% – Rs 13,251/month
If the Dearness Allowance (DA) increases by 4%, then there will be an increase of Rs 1262/month in salary.
DA Hike: Dearness Alowance arrear will likely be disbursed alongwith the increase in DA
Along with the probable announcement of Dearness Allowance / Dearness Relief (DR) hike this month, sources also said that two months’ arrears will also be paid. This will likely include payment of increased DA for January 2023 and February 2023. That is, an additional payment of Rs 1262 + 1262 will be made along with the salary / pension for March 2023.
Dearness Allowance Hike: Calculation at 42% DA
After the 4% dearness allowance (likely to be announced soon), the total DA figure will rise to 42%.
If calculated in the maximum salary range, then the total annual dearness allowance on the basic salary of Rs 56,900 will be Rs 2,86,776. Those falling in this pay grade will get Rs 2,276 more as DA than the current rate. Their monthly DA amount will then rise to Rs 23,898 with this imminent DA hike announcement.