7th Pay Commission: Centre may hike Dearness Allowance by 4%
What's the story
The central government is evaluating the possibility of increasing the Dearness Allowance (DA) for its employees by four percent after several states recently hiked their DA for state government employees, according to the news outlet News 18.
This new four percent hike will further increase the DA to 46%, as per reports.
DA is typically raised twice a year, in January and July.
Context
Why does this story matter?
This development comes right after the Madhya Pradesh government recently decided to increase DA for its employees by four percent.
Before Madhya Pradesh's move, Odisha also announced a four percent hike in DA for its pensioners and employees.
Notably, the dearness allowances for pensioners and employees have been increased to 42% from the existing 38%.
Details
All you need to know about DA and DR
To note, DA is given to government employees, while pensioners receive Dearness Relief (DR).
As per the official numbers, there are approximately 69.76 lakh pensioners and 47.58 lakh central government employees in India currently.
After the upcoming DA hike by the Centre, these pensioners and employees will be the ones to receive the benefits of it.
More details
Know when next DA hike will be
The last DA and DR hike was announced by the Prime Minister Narendra Modi-led central government back in March this year.
Union minister Anurag Thakur announced a four percent hike to 42% in the DA and DR for central government employees.
The next hike in DA is expected to be announced later this year in September or October.
Know more
One-time pension scheme change allowed: Details here
On the other hand, the Department of Personnel and Training (DoPT) stated that All India Services (AIS) officers who were hired against vacancies advertised before the December 22, 2003, NPS notification might be allowed a one-time option to avail the Old Pension Scheme (OPS).
As per The Financial Express, the scheme will be covered under the 1958 AIS (Death Cum Retirement benefit) Rules.
Further information
Here's all you need to know about OPS, NPS
All AIS officers get their wages according to the recommendations of the 7th Pay Commission for central government employees.
Under the old pension scheme, they are eligible for a monthly pension equal to 50% of the last drawn payment at the time of superannuation/retirement.
However, under the NPS, the pension is based on employee and employer contributions, and the returns are market-based.