In a timely Diwali gift 🎁, the Union Cabinet has approved a 3% increase in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners under the 7th Pay Commission. With this hike, both DA and DR now stand at 53%, up from the previous 50%. 🙌
Key Highlights of the 3% DA Hike 🔑💼
- Effective Date: The revised DA and DR are effective from July 1, 2024.
- Payouts: Central government employees will receive the higher DA starting from their October salary, while pensioners will see an increase in their pension. Additionally, both groups will receive arrears for July, August, and September, credited alongside their October disbursements. 💰
- Beneficiaries: Over 1 crore central government employees and pensioners across India will benefit from this increase.
- Financial Impact: This revision will cost the government an additional ₹9,448 crore. 🏦
What are DA & DR? 🧐
- Dearness Allowance (DA): A cost-of-living adjustment paid to government employees to counter the impact of inflation.
- Dearness Relief (DR): Similar to DA but provided to pensioners, ensuring their pension keeps up with inflation. Both DA and DR are adjusted based on the All India Consumer Price Index (AICPI), which tracks inflation trends.
How is DA Calculated? 📊
For central government employees:
- DA (%) = [(Average AICPI for the past 12 months – 115.76) / 115.76] x 100
For public sector employees:
- DA (%) = [(Average AICPI for the past 3 months – 126.33) / 126.33] x 100
This formula ensures that salaries and pensions remain in sync with the rising cost of living, providing some financial relief, especially during the festive season. 🌟
With this announcement just ahead of Diwali, government employees and pensioners can now look forward to enjoying the festivities with a little extra in their pockets! 🪔🎉