The days of happiness may soon return for central government employees, as reports suggest that the Dearness Allowance (DA) could rise from 2% to 4% in 2025. This increase, which has been a great hope for employees in these times of inflation and an increase in the cost of living, will surely give them much relief.
Hiking Of The DA Is On Cards
The biannual update of DA takes place twice a year with one revision in Jan while the other is in July according to the Consumer Price Index for Industrial Workers (CPI-IW). Analysts believe that it could be around a rise of 2% to 4% for the year 2025. If sanctioned, this shall be a much bigger and fatter amount that will favor welfare for central government employees and pensioners.
Currently, the DA stands at 50% and post the hike can shoot up to 52%-54% thus resulting in a huge net salary increase. The Union Cabinet is supposed to meet soon on this issue keeping in mind the rising costs of basic goods and services.
Salaries To Be Impacted By The DA Increase
DA is the percentage of basic pay, hence the projected increase of 2%-4% will add an extra Rs 360-720 to one month’s pay for a government employee with a basic pay of Rs 18,000 per month. The amount is higher for higher pay scales.
The new DA will also increase both DR and DA for pensioners. Therefore the monthly pension will be affected proportionately for retired employees.
Basic Indicators Behind An Increase In The DA
- Inflation Rate: Rising inflation has made an employee pay a lot of money in daily expenses so it was now important to change the DA, government had to do it.
- 7th Pay Commission Formula: The DA is arrived at based on the recommendation of the 7th Pay Commission that compensates employees properly.
- Welfare of the Employees: The government keeps on revising DA so that employees and pensioners can meet their financial needs.
Final Decision To Be Announced Soon
Though the media speculates that the announcement concerning the hike of dearness allowance will happen very soon in a matter of weeks, it would give some relief to more than 1 crore central government employees and pensioners. Moreover, the retrospective implementation of the increase means employees stand to gain dues backdated to January 2025.
Increase in salaries is likely from high predictions, enticing the government employee at the dawn of New Year 2025 to a new hope of financial stability. The announcement of the final DA percentage and the date of implementation will soon follow.
Also Read: DA Latest Update: DA Of Government Employees Zero After Approval Of 8th Pay Commission