7th Pay Commission: Will Central Government Employees Get a Pay Increase This Month? Here Are the Expectations

According to media sources, the central government will probably publish the most recent DA increase before the end of this month. The increase in dearness allowance, which will take effect on July 1, 2023, is anticipated to be 3%, rising to 45%. In the most recent development, the Himachal Pradesh government increased DA for Forest Corporation workers by 3% beginning January 1, 2022.

The Labour Bureau releases the most recent Consumer Price Index for Industrial Workers (CPI-IW) each month, which is used to calculate the dearness allowance for workers and retirees. A division of the Labor Ministry is the Labor Bureau.

The All-India CPI-IW for July 2023 increased 3.3 points to 139.7, according to the most recent statistics. With regard to the previous month, it climbed by 2.42 percent, compared to a rise of 0.90 percent between comparable months a year earlier.

Here is the expected wage increase for central government workers based on media reports of a 3% DA raise. Suppose someone makes Rs 50,000 a month in salary, with Rs 15,000 serving as basic income. Currently, he or she receives a dearness allowance of Rs. 6,300, or 42% of the base salary. The DA would rise to Rs 6,750 per month with the anticipated 3% increase, which is Rs 450 more than before. As a result, if a person makes Rs 50,000 per month and receives Rs 15,000 in basic pay, his or her income will increase by Rs 450 per month.

Government workers get DA, whilst retirees receive DR. In January and July of each year, DA and DR are raised. Over one crore pensioners and workers of the federal government now get a 42% dearness payment.

The General Secretary of the All India Railwaymen Federation, Shiva Gopal Mishra, said to the news agency PTI last month that the Federation is asking for a four percentage point increase in the dearness allowance. However, the increase in the dearness allowance amounts to little more than three percentage points. “DA is probably going to go up three percentage points to 45%.”

Additionally, he said that the finance ministry’s spending section will draft a proposal to increase DA along with the income implications and submit it for approval to the Union Cabinet.

The DA was raised by 4% to 42% in the most recent increment in March 2023. According to a number of sources, the next DA increase will likely be 4% given the current inflation rate.

Recently, a number of state governments raised the dearness allowance for their state government workers, including those in Madhya Pradesh, Odisha, Karnataka, Jharkhand, and Himachal Pradesh.

How Does the Government Choose To Raise The DA?

The percentage rise in the 12-month average of the All India Consumer Price Index (AICPI) for the period ending June 2022 is used to determine the DA and DR increases. Despite the fact that the federal government adjusts the allowances twice a year on January 1 and July 1, the decision is often made public in March and September.

The formula used by the central government to determine the DA and DR for central government workers and pensioners was changed in 2006.

Dearness Allowance Percentage is equal to ((Average of All-India Consumer Price Index for the last 12 months (Base Year 2001=100))/115.76×100.

Employees in the Central Public Sector: Dearness Allowance Percentage is calculated as follows: ((Average of All-India Consumer Price Index (Base Year 2001=100) for the previous three months -126.33)/126.33)x100.