DA hike before Diwali? Big update for central government employees

The government is expected to announce a 3% Dearness Allowance (DA) hike for central employees just ahead of Diwali, as per multiple media reports. Initially, an announcement was anticipated following the Union Cabinet meeting on October 9. However, sources now indicate that the official declaration may come closer to the Diwali celebrations, set for October 31, 2024.
Speculation is rife after recent reports suggested that the decision could be finalised in the next Cabinet meeting, scheduled just days before the festival.
Dearness Allowance (DA) is a crucial component of a government employee’s salary, designed to offset the impact of inflation on the cost of living. It is calculated based on the All India Consumer Price Index (AICPI), which tracks retail price movements. DA is revised twice a year, providing employees with financial support that helps maintain their purchasing power as living costs rise.
For central government employees, a hike in DA not only translates to increased take-home pay but also affects various other allowances, enhancing overall financial security.
The Confederation of Central Government Employees and Workers had recently urged Finance Minister Nirmala Sitharaman to speed up the announcement. Employees are eagerly waiting for this update, especially as inflation continues to impact households across the nation.
Currently, the DA stands at 50%, but if the government moves ahead with this plan, the new rate could go up to 53%, effective from July 1, 2024. It will benefit more than a crore central government employees and pensioners. Not only will employees enjoy a higher salary going forward, but they’re also expected to receive arrears for the months of July, August, and September.
The potential 3% hike mirrors the government’s pattern from last year, where the increase was announced right before the festive season, giving employees something extra to celebrate. While the official decision hasn’t been made yet, industry insiders say the announcement is just around the corner.
It is worth noting that the Himachal Pradesh government has already given its employees an early Diwali surprise with a 4% DA hike just before Dussehra. Chief Minister Sukhwinder Singh Sukhu announced the boost for 1.80 lakh employees and 1.70 lakh pensioners, bringing smiles to households across the state. The state government has also promised early salaries and pensions this month, adding to the festive cheer.
On top of that, pensioners above 75 years will receive their pending arrears, with over Rs 200 crore being spent on this financial boost. As for central employees, it’s not just about the DA hike – it’s a game of catch-up. The last increase in March 2024 saw DA jump from 46% to 50%, with a ripple effect on other allowances like house rent.
But with the 7th Pay Commission’s guidelines linking automatic pay revisions to the DA crossing 50%, employees and unions are now looking at the bigger picture: the 8th Pay Commission could be the next battlefront.
So, what does all this mean? For central employees, a bumper Diwali could be on the horizon, as they eagerly await the government’s official nod. With a possible 3% DA boost, the announcement could bring some much-needed relief amidst global inflation and rising prices.