Good news to Federal employees-an increase soon for DA approved with the Union cabinet. Their salaries increase due to the increase in dearer allowance of 2%. As reports oblige, a decision to take the dearness allowance in the next cabinet meeting presided over by Prime Minister Narendra Modi is expected to happen today, Wednesday. Know here how this will benefit the employees.
What’s The New Data?
- The increase in the All India Consumer Price Index (AICPI-IW) for industrial workers in January 2025 has come out at a fall of 0.5 points to 143.2.
- This decline can become the basis of an increase in dearness allowance.
- This is the second consecutive month when this index has decreased as, in the month of December 2024, AICPI-IW fell by 0.8 points.
Figures Of AICPI-IW For January 2025:
AICPI-IW index decreased by 0.5 points in January 2025, reaching now 143.2, as per data released by the Labor Bureau of the Ministry of Labor and Employment. This is the second month in a row which this index has declined, with December 2024 registering an 0.8 point drop as well.
What Is Dearness Allowance?
Dearness allowance (DA) is a supplementary advantage granted to central government employees over and above the monthly basic pay to mitigate the inflationary effect. So, currently, a central government employee gets 53% of the salary in the form of a dearness allowance.
What Can Be The Expectation Of DA Increases?
Central government decides dearness allowance based on AICPI-IW data, which is as per the recommendations of the 7th Pay Commission. As per reports, dearness allowance may increase by 2% with effect from January 2025. This increase might be due to the fall in AICPI-IW during the latest.
What Will Be The Increase In Salary?
There will be an increase in a salary entry level employee because of the dearness allowance’s increase by 2%. For example, if his basic salary is 18,000, that means he will be getting an additional 360 rupees considering 2%. Currently, for basic pay of 18,000, 53% DA would be approximately 9,540. Now, after the increase of 2%, it will become 9,900, hence increasing his salary by 360 rupees. Had it been increased by 3%, the difference would have amounted to 540 rupees, thus giving him a DA adjustment of 10,080.
Also Read: DA Hike New Update: AICPI-IW Drops, What It Means For Central Govt Employees