7th Pay Commission: The central government is likely to announce a 3-4 percent DA hike for central government employees in October. May be announced before Diwali.

7th Pay Commission: The month of October is very important for central government employees as they eagerly await their pay hike. There is no official update yet on DA rate hike announcement; However, dearness allowance for central government employees was increased in the first week of October. The central government is likely to increase the dearness allowance by three to four percent before Diwali, probably in October. It is to be noted that the basic pay of entry-level central government employees, which is around Rs 18,000 per month, will increase to the range of Rs 540-720 per month after the DA hike announcement. The increased salary will come into effect from July 1, 2024, News18 reported citing sources.

7th Pay Commission DA Hike: Expected Salary Hike

If an employee is currently drawing a monthly salary of Rs 30,000 and his basic pay is Rs 18,000. He also gets Dearness Allowance (DA) of Rs 9,000, which reflects half of his basic pay. Now, imagine an increase of approximately 3%. So his DA will reach Rs 9,540, he will be offered an additional Rs 540. Now, let's look at some more numbers and add 4% DA. This will lead to a revised DA of Rs 9,720 per month. So, an employee taking home around Rs 30,000 per month with a basic salary of Rs 18,000 can increase their salary by an additional Rs 540 to Rs 720 per month.

7th Pay Commission DA Increase: What is Dearness Allowance?

Dearness Allowance, commonly known as DA, is paid to those working for the government, while Dearness Relief, or DR, is dedicated to those on retirement. The rates of both DA and DR are revised and adjusted twice a year, in the months of January and July. At present, a large group of over one lakh central government employees and those enjoying their golden years are the beneficiaries of the 50 per cent dearness allowance.

The government did not shy away from showing its generosity in March 2024, as it increased both dearness allowance and dearness relief by 4 per cent. This means an increase of up to 50 percent of the basic salary of government employees, which is a significant development.

7th Pay Commission DA Hike: How Govt Decides DA Hike?

Dearness Allowance (DA) and Dearness Relief (DR), important components of the pay structure, are determined based on the All India Consumer Price Index (AICPI) average over the 12-month period ending June 2022. We usually expect changes. These allowances include twice a year – starting in January and July, official announcements, however, often occur around March and September.

In an interesting move in 2006, the government revised its DA and DR search tools for its employees and pensioners.

Here's what they use to calculate the inflation allowance percentage:

Let's take the 12-month average of the All India Consumer Price Index (using the base year 2001 which equates to a score of 100) and subtract it from 115.76, then divide the result by 115.76 and multiply by 100.

However, for central public sector employees, the calculation varies slightly:

They use the last 3-month average of the All India Consumer Price Index (base year 2001 equal to 100), subtract it from 126.33, then divide the result by 126.33 and finally multiply by 100.

8th Pay Commission Latest Update

Although the usual practice is to set up a pay commission every ten years, it is not legally required to specifically set up a pay commission during the same period.

Seventh Pay Commission, which started its journey back in February 2014, is soon completing a decade. However, the Commission's recommendations did not come into effect until January 1, 2016. Hence, by the end of next year, it will reach the ten-year mark, completing a decade of its implementation.

8th Pay Commission: How Much Will Salary Increase?

There is a possibility of an increase in the salaries of central government employees. If the proposed changes are implemented using a fitment factor of 1.92, the basic pay will be reduced to its current Rs. 18,000 to Rs. May rise to a more comfortable figure of 34,560. Similarly, pensioners can also get a promising increase of Rs 17,280 in their minimum pension.