Will central government employees get DA hike before Diwali?
What's the story
Central government employees across India are eagerly awaiting an announcement regarding a potential hike in Dearness Allowance (DA) and Dearness Relief (DR). The wait coincides with today's crucial Union Cabinet meeting, where a decision on the matter is highly anticipated. The move comes after the Confederation of Central Government Employees and Workers raised concerns over the delayed announcement of these hikes. Usually, DA and DR are revised twice a year—in January and July—with official announcements coming later.
Impact
DA hike could benefit over 1 crore individuals
Over one crore central government employees and pensioners currently enjoy a DA rate of 50%. The proposed hike could increase it to 54% of the basic salary, with a retroactive application from July 1, 2024. If approved, employees would get three months' worth of arrears in their October salaries. The last DA hike was a 4% increase announced in March this year, effective from January 2024.
Calculation
DA hike is based on Consumer Price Index
The DA hike is primarily determined by the All India Consumer Price Index (AICPI), which tracks retail price changes across sectors. The Confederation of Central Government Employees and Workers had recently written to Finance Minister Nirmala Sitharaman in a letter, raising concern over the delay in announcing this hike. The DA is a critical component of central government employees' salaries, functioning as an allowance to offset inflation and rising living costs.