DA Increase: There’s great news for central government employees! Dearness Allowance (DA) is set to increase once again in July 2023, leading to a significant salary hike for employees.
It is anticipated that there will be a 4 percent increase in the DA, bringing the total DA to 46 percent. The recent AICPI (All India Consumer Price Index) numbers have infused renewed hope among central employees.
As we enter the monsoon season, it seems that central employees are in for a financial boost. However, we are still awaiting the AICPI numbers for May and June, which are expected to show positive growth. The government is likely to announce the increase in dearness allowance in either September or October.
With a 4 percent DA hike, the annual dearness allowance for employees will reach an impressive sum of Rs. 1,68,636.
How will the DA for July 2023 be determined?
Looking at the AICPI index numbers for April 2023, there has been a 4% increase in the dearness allowance. Soon, the dearness allowance will reach 46%. Even if there is no further increase in the index for May and June, the DA score may surpass 45.60, resulting in a 46% dearness allowance. Similarly, if the CPI(IW) numbers rise from 134.2 to 134.8, there is hope of achieving a 46% DA. If everything goes smoothly, the payment of DA to central employees, which will increase from July 2023, will be reflected in their October salaries.
The DA will amount to Rs. 1,68,636
After increasing the dearness allowance by 4%, the total DA will reach 46%. Let’s take the example of an employee with a pay band of Rs. 30,550. The annual DA at a rate of 46% will amount to Rs. 1,68,636, while the current amount is Rs. 1,53,972. This means that the salary will increase by Rs. 14,664 compared to the current dearness allowance.
Understanding the calculation based on the basic salary:
- Basic salary of the employee: Rs. 30,550
- Existing DA (42%): Rs. 12,831 per month
- Annual DA (42%): Rs. 1,53,972
- Increased DA (46%): Rs. 14,053 per month
- Annual increase in DA: 14,053 x 12 = Rs. 1,68,636