7th Pay Commission: Under the 7th Pay Commission, dearness allowance is given twice to the central employees. First January and second July. Meaning dearness allowance is announced for two half of the year.
7th Pay Commission: There is a big update for central employees. In the coming days, he is going to get a bumper gift. To deal with the rising inflation, there can be a big increase in the Dearness Allowance Hike of the employees. Actually, this has been confirmed by the numbers from the AICPI index that came in March. Dearness allowance may increase at the rate of 4% in July-August. However, the numbers for three months are yet to come. In view of the rising inflation, it seems that the increase in DA may be even higher in the coming days. Overall Dearness Allowance (DA Hike) can cross 38%.
DA can increase by more than 4%
There was a slight decline in the AICPI Index in January and February 2022. But, there has been a big jump in the number of March. This has once again cleared the way for an increase in Dearness Allowance. The index has jumped 1 point in March 2022. Due to this, the next dearness allowance (Next DA Hike) is likely to increase by 4%. However, the numbers for April-May and June are yet to come. If it continues to bounce even further, then it can be expected that the DA can increase by 4% or more.
Evaluation is done by AICPI numbers
Under the 7th Pay Commission, dearness allowance is given to central employees twice. First January and second July. Meaning dearness allowance is announced for two half of the year. Till January 2022, the central employees have got the gift of 3% DA Hike. His total DA is 34 percent. Now the next Dearness Allowance (Next DA Hike) will be released for July. It can be announced in the month of August. All India Consumer Price Index is used to calculate the allowances of employees in comparison to inflation. The Labor Ministry collects these data and then issues the numbers. In January the index was down to 125.1 as compared to December 2021. At the same time, in February it had reached 125 points. But, there has been a big jump in March and the index has increased by 1 point to 126. In December 2021, the AICPI figure stood at 125.4.
Labor Ministry releases figures
The dearness allowance figures only indicate how much the next dearness allowance can be increased. If the index shows a jump in the next three months (April-May and June), then the DA Hike can be more than 4%. The data of AICPI is decided by the Ministry of Labor and Employment on the basis of retail prices collected from 317 markets located in 88 industrially important centers of the country. The index is prepared for 88 centers and for the entire country. AICPI is released on the last working day of every month.
Why employees are given DA
Dearness allowance is given to central and state government employees to improve their cost of living level. Even after rising inflation, there is no difference in the standard of living of the employee, so this allowance is given. Dearness allowance (DA) is given to government employees, public sector employees and dearness relief to pensioners.
Labor Ministry changed base year
The Ministry of Labor and Employment has changed the calculation formula regarding Dearness Allowance. The Labor Ministry has changed the base year 2016 for Dearness Allowance (DA Calculation). A new series of Wage Rate Index (WRI-Wage Rate Index) has been released. The Labor Ministry said that the new series of WRI with base year 2016=100 will replace the old series of base year 1963-65.