The government has increased the dearness allowance or DA for central government employees and pensioners by 4 percent to 42 percent with effect from January 1, 2023.
The DA hike decision will cost the central exchequer Rs 12,815.60 crore per annum, Union minister Anurag Thakur told reporters on Friday after the meeting of the Cabinet Committee on Economic Affairs (CCEA).
The official notification said: “Cabinet has today approved the release of an additional instalment of Dearness Allowance to Central Government employees and Dearness Relief to Pensioners, due from 1st January 2023. This will benefit 47.58 lakh employees and 69.76 lakh pensioners.”
Central government employees and pensioners were paid DA (dearness allowance) and DR (dearness relief) at the rate of 38 percent under the 7th Pay Commission. Now with this 4 percent rise in DA, this allowance will increase to 42 percent.
DA will be adjusted in March salary at the rate of 42 percent and arrears of 2 months — January and February 2023 — will also be added.
Central government employees can calculate the increase in their salary according to their basic pay and grade after the DA hike.
DA Calculation:
Suppose, a central government employee was getting a basic salary of Rs 25,000 per month, so at 38 per cent, his dearness allowance was Rs 9,500. As DA jumps to 42 per cent, his DA will rise to Rs 10,500. So, with the latest hike, his salary will be raised by Rs 1,000.
Formula used to calculate the dearness allowance hike of central government employees:
Dearness Allowance Hike Formula is – [(Average of All India Consumer Price Index AICPI) for the last 12 months – 115.76)/115.76]×100.
Formula for calculating DA hike of PSU personnel:
Dearness Allowance Percentage = [Average of Consumer Price Index for the last 3 months (Base Year 2001 = 100)-126.33)] x100
