We have a piece of good news for Central government employees! Prime Minister Narendra Modi-led Central government is all set to increase the Dearness Allowance (DA) of employees yet again. Earlier in August, the Centre had increased DA under the 7th Pay Commission for lakhs of its employees and pensioners. The DA was increased from 17% to 28%, with effect from July 2021.
Now, according to the latest reports, the DA is likely to increase again and this time to 31% percent from the existing 28%. If this is true then the monthly salary of Central government employees will notably increase as a hike in DA directly affects the salary component.
According to reports, more than 50 lakh permanent Central government employees and 65 lakh pensioners will benefit from this. For those who are unaware, DA was increased by 4% in January 2020, then by 3% in June 2020, and by 4% in January 2021. Now, these three installments have to be paid. According to the data of AICPI, there is going to be a 3% increase in DA in June 2021 under the 7th Pay Commission. If this happens, then the total DA will increase to 31% which will be paid with the salary of September.
Salary calculation on 31% Dearness Allowance
Now if the Dearness Allowance increases by 3 percent in June, then the total DA will become 31%. Now on the basic salary of Rs 18,000, the total annual Dearness Allowance will be Rs 66,960. But talking about the difference, the annual increase in salary will be Rs 30,240.
- Basic salary of the employee Rs. 18,000
- New Dearness Allowance (31%) Rs.5580/month
- Old Dearness Allowance (17%) Rs.3060/month
- Calculate the difference: 5580-3060 = Rs.2520/month
- Increase in annual salary 2520X12 = Rs 30,240
Source: DNA India