7th Pay Commission Latest News: Central Employees Get Diwali Gift as Union Cabinet Approves 3% DA Hike

The Union Cabinet on Wednesday, October 16, decided to hike the Dearness Allowance (DA) for central government employees by 3%, according to media reports.

If the Cabinet indeed increases the DA by 3%, employees will now receive 53% of their basic salary as DA. Currently, employees receive 50% of their basic salary as DA. However, no official announcement has been made by the government yet.

Should the DA increase be confirmed, it will benefit more than 68 lakh employees and around 42 lakh pensioners. Along with the increased salary or pension, employees and pensioners will also receive three months' arrears.

Also Read | DA Hike in Chhattisgarh: State Government Employees to Get 50% Dearness Allowance Ahead of Diwali.

The central government reviews DA twice each year—in January and July. The DA hike for January is usually announced between March and April, while the July increase is declared in September-October. In addition to the hike, employees also receive arrears for the intervening months.

For example, if an employee's basic salary is Rs 18,000, they currently receive Rs 9,000 as DA (50%). After the 3% increase, they will receive 53% of their basic salary, amounting to Rs 9,540 as DA.

The dearness allowance has been increased by 3%, so let us see how much benefit all employees and officers receiving salaries based on the 7th Pay Commission will get on a monthly and annual basis. Government employees with a basic salary of Rs 18,000 will see a 3% increase in dearness allowance, amounting to Rs 540 per month, which translates to an annual benefit of Rs 6,480. Similarly, employees with a basic salary of Rs 20,000 will receive Rs 600 more per month and Rs 7,200 annually. For those with a basic salary of Rs 25,000, the increase will be Rs 750 per month and Rs 9,000 per year.

If your basic salary is Rs 30,000, the benefit will be Rs 900 per month and Rs 10,800 per year. Employees with a basic salary of Rs 40,000 will receive a monthly DA benefit of Rs 1,200, with an annual benefit of Rs 14,400. Similarly, employees with a basic salary of Rs 50,000 will gain Rs 1,500 more per month and Rs 18,000 per year.

Government employees with a basic salary of Rs 60,000 will benefit from the 3% DA hike by Rs 1,800 per month and Rs 21,600 per year. Employees with a basic salary of Rs 70,000 will gain Rs 2,100 per month and Rs 25,200 annually. If your basic salary is Rs 80,000, you will benefit by Rs 2,400 per month and Rs 28,800 per year. Similarly, employees with a basic salary of Rs 90,000 will see an increase of Rs 2,700 per month and Rs 32,400 annually. Those with a basic salary of Rs 1,00,000 will benefit by Rs 3,000 per month and Rs 36,000 per year due to the 3 percent dearness allowance hike.

Employees earning a basic salary of Rs 1,25,000 will get Rs 3,750 more per month and Rs 45,000 more per year, while those with a salary of Rs 1,50,000 will gain Rs 4,500 more per month and Rs 54,000 more per year after this hike. Employees earning Rs 1,75,000 will see an increase of Rs 5,250 per month and Rs 63,000 per year, and those with a basic salary of Rs 2,00,000 will receive Rs 6,000 more per month and Rs 72,000 more per year. Government officials with a basic salary of Rs 2,25,000 will benefit by Rs 6,750 per month and Rs 81,000 per year due to the 3 percent DA hike. Similarly, top officials with a basic salary of Rs 2,50,000 will see a benefit of Rs 7,500 per month and Rs 90,000 per year.

It is worth noting that prior to the COVID-19 pandemic, until December 2019, all officers and employees receiving salaries based on the 7th Pay Commission were getting dearness allowance and dearness relief at a rate of 17 percent. However, for three consecutive review periods, or for one and a half years, no amendment or increase was made in dearness allowance due to the pandemic. As a result, all officers and employees were receiving only 17 percent dearness allowance until June 2021.