Good things were set for the New Year on offer for central employees in terms of a putative increase in dearness allowance (DA). It seems based on AICPI index data that at least a 3 percentage point increase in DA is most likely. It was expected to touch 56 percent during January 2025 with extension. Current trends are with the previous data that at best the increase of dearness allowance will be of 3 percent for November and December as well. This would be an important step in improving the economic state of employees-improving their purchasing power.
AICPI figures-
The AICPI index tracks inflation and alterations in price changes of commodities in the country. The following data pertains to July, August, September, and October 2024. The index measured 142.7 points in July, which implies that the dearness allowance stands at 53.64%. The index dropped to 142.6 points in August, with the allowance remained at 53.95%. In September, the index went up to 143.3 points, whereas the allowance stood at 54.49% of it. For October, the index reached 144.5 points, thus making the dearness allowance 55.05%. Presently, the allowance stands at 53%, which will be effective from July 2024.
New DA will take effect on January 1st:
The Central Government revises the DA every half year. After the DA increase of 3% in July 2024, an increase of 3% is now expected in January 2025. More than 1 crore of employees and pensioners will benefit from this. From January 2025, the new dear ness allowance (DA Hike Update) for central employees will be applicable. It is, however, expected to be announced in March 2025. Usually, this is around Holi in March when the government announces it.
The full Dearness allowance data is this.
Currently, as of October, the index number is at 144.5 points which is why the present dear allowance stands at 55.05 percent. If we look forward to the next two months extrapolating this trend, then possibly it will climb to 145 points in November. As a result of that, dear allowance will rise to 55.59 percent. Similarly, in December, it is presumed that the index number will be standing at 145.3 points; as a result, dearness allowance will witness a good jump. But, it will be reaching to 56.18 percent. Under such circumstances, thus, the total dearness allowance might be raised by only 3 percent.
From how much the salary increases?
Under pay grade of 7th pay commission, employees having the least basic salary, raises have been given, by how much possible Rs. 6480 annually. To give an idea, if basic pay is say 18,000 and DA is at 56% then this is how it computes:.
DA from January 2025: Rs18,000 x 56% = Rs 10,080/month
DA from July 2024: Rs 18,000 x 53% = Rs. 9,540/month
Difference on 3% increase: Rs540 per month
Disclaimer: The salary mentioned above is purely based on estimations or calculations. Actual salary can be far divergent from it on applying other allowances and fitment factor. Here it is showing only the difference in Dearness Allowance.
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