The Dearness Allowance (DA) for central employees and pensioners is currently set at 53%, and the new DA rates are set to be revised from January 2025.
The central government reviews and adjusts the DA and Dearness Relief (DR) rates for employees and pensioners twice a year, based on the biannual data of the All India Consumer Price Index. These adjustments are typically announced in March and October, with changes implemented in January and July each year.
Currently, central employees and pensioners are receiving a 53% Dearness Allowance (DA) and Dearness Relief (DR), with new DA rates set to be revised from January 2025. There were earlier reports suggesting that a proposal for the DA hike might be presented at the cabinet meeting on March 12, before Holi, but that did not take place. However, it is now expected that a major announcement regarding the DA revision could be made this week. Approximately 1.20 crore employees and pensioners will benefit from this.
Will dearness allowance increase by 2 or 3%?
- At present, central employees pensioners are getting the benefit of dearness allowance and relief at the rate of 53%. As per the rule, the rates of DA are to be revised again from January 1, 2025, which will depend on the data of AICPI Index from July to December 2024 by the Ministry of Labor.
- If we look at the data from July to December, the AICPI Index score has crossed 143.7 and DA score 55.99%, in such a situation, it is expected that 2 to 3% increase in DA is possible, because the one before 0.50 is calculated downwards and the one above is rounded off upwards. If the DA score is counted at 55%, then there will be an increase of 2 percent and if it is counted at 56%, then there will be a 3 percent increase.
- Since the new rates will be applicable from January 2025, the arrears of 2 months January and February will also be available. There is a possibility that new rates can be announced this week and the amount can increase in the account from April. After the cabinet’s approval, orders will be issued by the Finance Ministry. This increase will be done under the 7th Pay Commission.
How much will the salary increase on DA HIKE?
- DR for DA and pensioners is calculated on the basis of Consumer Price Index (CPI-IW) applicable for industrial workers.
- If DA is increased by 2%, their DA will increase to 55 percent, in such a situation, if the basic salary of an employee is Rs 20,000 per month, then the monthly salary will increase by Rs 400. At 3 percent it will become Rs 600 per month.
- For employees whose minimum salary is Rs 18,000, their DA can increase up to 9900 annually by increasing it by 2 percent. If the basic salary of an employee is Rs 50,000 and the DA rate is 53 percent, then his total salary (excluding other allowances) will be Rs 76,500. If the DA rate is increased to 56 percent, the total salary will increase to Rs 78,000.
Employees and pensioners are waiting for 18 months of DA arrears
- Central employees and pensioners are waiting for DA arrears of 18 months stopped during the Corona pandemic along with the dearness allowance hike. The Confederation of Central Government Employees and Workers has again raised the issue of several demands including pending DA arrears from July 2020 to January 2021 before the central government.
- The Federation says that the central government should pay these pending arrears as it is the right of employees and pensioners. But the government has not accepted this demand till now. Many pending demands from the central government should be resolved as soon as possible.
- If DA arrears are paid, then the DA arrears of Level-1 employees can be between Rs 11,880 to Rs 37,554, Level-13 (7TH CPC basic pay scale Rs 1,23,100 to Rs 2,15,900) or Level-14 (pay scale) can be paid between Rs 1,44,200 to Rs 2,18,200.
These are the main demands of the Federation
- The federation wants the appointment of committee members including the chairman under the 8th Central Pay Commission.
- The new pension scheme should be abolished and the old pension scheme (OPS) should be restored.
- The three DA installments stopped during the Covid pandemic should be paid.
- The amount deducted from the pension of employees and pensioners should be restored in 12 years (currently this period is 15 years).
- The 5% limit on compassionate employment should be removed and all eligible applicants should be given employment.
- Vacant posts in all departments should be filled immediately and outsourcing and privatisation in government departments should be stopped.
- Employee organisations should be allowed to work in a democratic manner.
