7th Pay Commission: How Much Will Salary of Central Govt Employees Increase After DA hike in October?

7th Pay Commission: The central government employees are keenly awaiting the announcement of a DA hike that will raise their salaries. Though the Centre will make an announcement in October, there has not been any official announcement so far. Last year, the DA was hiked in the first week of October.

According to sources, the government is expected to announce a 3-4 per cent DA hike in October before Diwali. After the announcements, salary of the entry-level central government employee, who has a basic salary of around Rs 18,000 per month, will increase in the range of Rs 540-720 per month, effective from July 1, 2024.

7th Pay Commission DA Hike: How Much Is the Salary Hike Expected?

If somebody’s salary is Rs 30,000 per month and has Rs 18,000 as the basic pay. He or she now gets Rs 9,000 as dearness allowance, which is 50 per cent of the basic pay. However, after the expected 3 per cent hike, the employee will get Rs 9,540 per month, which is Rs 540 higher. However, in case of 4 per cent DA hike, the employee will get a revised DA of Rs 9,720 per month.

So, if someone has around Rs 30,000 salary a month with Rs 18,000 as the basic pay, his or her salary will rise by Rs 540-720 per month.

DA is given to government employees, while DR is given to pensioners. DA and DR are hiked twice a year — January and July. Currently, over one crore central government employees and pensioners are getting a 50 per cent dearness allowance.

In the last hike in March 2024, the central government had raised dearness allowance by 4 per cent to 50 per cent of the basic pay. The government also increased dearness relief (DR) by 4 per cent.

How Does Govt Decide On The DA Hike?

The DA and DR hike is decided based on the percentage increase in 12 monthly average of the All India Consumer Price Index (AICPI) for the period ending June 2022. Though the central government revises the allowances on January 1 and July 1 every year, the decision is generally announced in March and September.

In 2006, the central government had revised the formula to calculate the DA and DR for central government employees and pensioners.

Dearness Allowance Percentage = ((Average of All-India Consumer Price Index (Base Year 2001=100) for the past 12 months -115.76)/115.76)x100.

For Central public sector employees: Dearness Allowance Percentage = ((Average of All-India Consumer Price Index (Base Year 2001=100) for the past 3 months -126.33)/126.33)x100.

8th Pay Commission Update

A pay commission is usually constituted every 10 years. It is a general practice. However, no such statutory provision is given anywhere which mandates the constitution of a pay commission strictly every 10 years.

As the 7th Pay Commission was constituted in February 2014, it has completed its 10 years. However, the commission’s recommendations were implemented from January 1, 2016. The implementation will complete 10 years by the end of the next year.

What Does Govt Says About 8th Pay Commission?

On the 8th Pay Commission, in July, the Confederation of Central Govt Employees and Workers has made several demands ahead of the Budget 2024, including the immediate constitution of the 8th Pay Commission and restoring the old pension scheme.

The 8th Pay Commission was not announced in the Union Budget 2024-25. Following the Budget on July 23, 2024, Minister of State for Finance Pankaj Chaudhary updated the 8th Pay Commission status in Parliament on July 30, 2024.

Chaudhary in a written reply in the Rajya Sabha on July 30 said, “Two representations have been received for constitution of the 8th Central Pay Commission in June 2024. No such proposal is under consideration of the government, at present”

How Much Salary Will Increase After 8th Pay Commission

According to reports, the minimum salary for the central government employees will likely increase to Rs 34,560 with a fitment factor of 1.92, compared with the current minimum salary of Rs 18,000. Likewise, the minimum pension is also expected to be fixed at Rs 17,280.

In the 7th Pay Commission, the salaries were increased by 14.27 per cent in 2016. However, in the previous 6th Pay Commission, the salaries for the central government employees saw a massive 54 per cent jump in 2006.