DA Latest Updates: Central government employees are likely to get good news related to their salary in the new year 2023. As per media reports, the government is expected to take a decision on three issues – DA and DR hike, fitment factor revision, and clearance of 18-month DA arrears. Government employees will get bonus from these three decisions.
Dearness Allowance (DA) and Dearness Relief (DR) are revised twice a year, with effect from 1 January and 1 July. The previous hike, which benefitted around 48 lakh central government employees and 68 lakh pensioners, raised DA by 4 per cent to 38. Percent. Earlier, the government had increased DA by three per cent to 34 per cent in March under the Seventh Pay Commission.
DA hike in 2023
As per media reports, DA and DR will be increased by 3-5 percent in March 2023, which will be effective from January 2023. With this hike, DA will go up to 43 per cent.
18-month balance
Apart from this, the issue of payment of DA arrears for 18 months from January 2020 to June 2021 can also be resolved soon. Employees can get payment of DA arrears of 18 months. The amount of DA arrears is decided by the pay band and structure of the employees.
fitment factor to be revised
The employees unions are demanding revision of the fitment factor in their salaries. The fitment factor is a general value that is multiplied by the basic pay to arrive at the total pay of the employees. in present,
The common fitment benefit for all groups of central government employees is 2.57. Now if someone is getting Rs 15,500 basic pay in 4200 grade pay, then his total pay will be Rs 15,500×2.57 or Rs 39,835.
The 6th CPC recommended a fitment ratio of 1.86. According to media reports, now the employees are demanding from the government to increase it to 3.68. The hike will increase the minimum wage from Rs 18,000 at present to Rs 26,000.
How is DA hike decided?
The government decides to increase DA on the basis of inflation rate in the country. If inflation is high, there are chances that DA will increase further. In the current scenario, retail inflation in India is above the RBI’s comfort zone of 2-6 per cent for the last 10 months. This may prompt the government to allow further hike in wages.
The DA and DR hike is decided on the basis of percentage increase in 12 monthly average of All India Consumer Price Index (AICPI) for the period ending June 2022. Though the central government revises the allowances every year on January 1 and July 1, the decision is generally announced in March and September.
In March, the Union Cabinet had approved a 3 per cent increase in DA under the 7th Pay Commission, thus taking DA to 34 per cent of basic income. In 2006, the central government revised the formula for calculating DA and DR for central government employees and pensioners.
Dearness Allowance percentage = ((Average of All India Consumer Price Index numbers for last 12 months (Base year 2001=100) -115.76)/115.76)x100.
For Central Public Sector Employees: Dearness Allowance Percentage = ((Average of All India Consumer Price Index numbers for last 3 months (Base year 2001=100) -126.33)/126.33)x100.
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