The Dearness Allowance (DA) hike is an important factor for the central government employees to whom the announcement monthly helps to sustain the escalating cost structure. Considering that the new improves are expected in October 2024, employees hope to know their realistic chances of a hike and how much increase will be given to them.
What do you understand by the term Dearness Allowance (DA)?
Dearness Allowance is a fixed portion of an employee’s basic wage in the central government and is given to counter the growth in the price index. And it is adjusted once in every six months depending on the cost of living index.
When is the Next DA Increase Likely to Occur?
Some speculations have pointed towards October 2024 and it is expected to be before Diwali festival as the DA hike announcement. DA has usually been announced in the beginning of this month and expectations are that it may this range between 3%- 4%. Though, no official support have been made yet.
Last year the DA hike was done in the first week of October, therefore this year’s timeline is expected to be set at the same period. A similar timing of improvement can be expected in the next year, that is in 2024 for government employees and pensioners.
How the DA Hike Works
The DA increment influences total remuneration of pay that employees receive. For instance, if an employee gets a basic wage of ₹ 18000 then current DA amount is ₹ 9000 which is 50% of the wage. They may decide on a 3% raise, which will raise the new DA to ₹9,540 when the government announces this new hike. Likewise, a 4% increase would give ₹720 towards the DA the new DA, or the revised DA, would increase and be at ₹9,720.
Frequency of DA Hikes
DA varies according to the rank or position of an employee and is generally reviewed by the government twice a year, in January and July. Nonetheless, the announcements are usually made in either March or October. The DA hike that normally takes effect in January is announced around Holi and the hike that will be implemented in July is during Diwali.