The last revision of DA was made in March 2023 by 4%, which came into effect on January 1, 2023. (Representative photo)
7th Wages Commission: Jharkhand government has increased the high cost allowance of its employees to 42% from 34%
7th pay commission: Although retail inflation in March 2023 declined to 5.66% to be below the RBI’s 6% upper tolerance limit, it is still far from the RBI’s 4% target. As this makes things more expensive, the dearness allowance for central government employees or DAs is expected to be increased by 3-4% soon for the period starting July 1, 2023, according to media reports. The DA is paid to employees and retirees to compensate them for price increases.
The last revision of the DA was made last month by 4%, which came into effect on January 1, 2023. After the 4% increase, the DA for central administration employees rose to 42%. Previously, the DA was raised in September 2022 by 4%, which came into effect from July 2022.
Now, for the 7th Wage Commission, the DA is expected to increase another 3-4%, starting in July, according to reports. Currently, according to the latest data, there are 47.58 lakh central government employees and 69.76 lakh retirees.
DA and DR are reviewed twice a year — January and July. High Cost Allowance is given to government employees, while High Cost Relief is for retirees. DA is granted to employees on the basis of the basic salary of the employees, while DR is granted on the basis of the basic pension.
On what basis Govt Hike DA?
The central government revises DAs and DRs for employees based on a formula. Here is the formula:
Expensive Allocation Percentage = ((All India Consumer Price Index Average (base year 2001=100) for last 12 months -115.76)/115.76)x100.
For Central Public Sector Employees: Percentage of High Cost Allowance = ((Average of All India Consumer Price Index (base year 2001=100) for last 3 months -126.33 )/126.33)x100.
Jharkhand Increases AD for State Government Employees
The Jharkhand government on Thursday increased the dearness allowance for its employees to 42% from 34%. The decision to increase the DA rate was taken at the state cabinet meeting, chaired by Chief Minister Hemant Soren.
The AD increase is in line with the accepted formula based on the recommendations of the 7th Central Wage Commission.
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