Dearness Allowance For 33 Lakh Central Govt. Employees Raised By 4% Under 7th Pay Commission

PM Modi Govt took a major decision today, fulfilling a long pending demand of all Central Govt. employees: DA or Dearness Allowance has now been raised under 7th Pay Commission.

DA For All 33 Lakh Central Govt Employees Raised

Effective January, 2020, all the Central Govt employees will now receive 4% more DA, which will help them to earn more monthly salary henceforth.

Last week, in the Rajya Sabha, Minister of State for Finance Anurag Thakur had informed the nation that the allowance of all Central Govt employees will be revised, and once revised, it will be effective January 4th.

The Minister had said, “Dearness Allowance and Dearness Relief are granted to serving employees and pensioners of the Central Government respectively each year with effect from 1st January and 1st July and normally paid in March and September, respectively,”

Now, the Union Cabinet has approved the recommendations of the 7th Pay Commission and hiked DA by 4% for all 33 lakh employees.

How The DA And Other Allowances Are Calculated?

The DA for Central as well as State Govt employees are always calculated based two factors: Rise in inflation and essential commodities’ price.

Since both inflation and the price of essential commodities have increased, Govt. was recommended to raise the DA to accommodate the increase in cost of living, under 7th Pay Commission.

Now, the recommendations have been approved.

Interestingly, Govt also calculates All India Consumer Price Index for Industrial Workers for calculating DA and other allowances.

This is how it works: For calculating the DA for the period between January to June, the actual inflation rate for July to December of the previous year is calculated.

Whereas for calculating the DA for July to December period, the inflation rate for January to June is calculated.

The DA is announced twice a year, based on these calculations. 

The recommendations under 7th Pay Commission are applicable to 33 lakh Central Govt employees, 14 lakh Armed forces and 52 lakh pensioners. 

But the rise in DA is only applicable to 33 lakh Central Govt. employees.