7th Pay Commission: The central government is likely to announce a 3 per cent DA hike next month. With this 3 per cent likely hike in September, the total dearness allowance will reach 53 per cent. However, the government is unlikely to release the 18-month arrears for DA and dearness relief (DR) that were halted during the COVID-19 pandemic.
In the monsoon session of Parliament, two members recently asked queries regarding the government’s decision on the DA arrears. To a question ‘Whether the government is actively considering to release an 18-month dearness allowance/ relief of central government employees/ pensioners which were withheld during COVID outbreak’, Minister of State for Finance Pankaj Chaudhary replied, “No”.
He added that, “The decision to freeze three installments of Dearness Allowance {(DA)/Dearness Relief (DR) to Central Government employees/pensioners due from 01.01.2020, 01.07.2020 & 01.01.2021 was taken in the context of COVID-19, which caused economic disruption, to ease pressure on Government finances… As the adverse financial impact of the pandemic in 2020 and the financing of welfare measures taken by the Government had a fiscal spillover beyond FY 2020-21, arrears of DA/DR were not considered feasible.”
However, the central government is likely to announce a 3 per cent hike in dearness allowance (DA) and dearness relief (DR) in September 2024, which will become effective from July 1, 2024.
The DA will also not be merged with the basic pay even as it rises beyond 50 per cent. It will continue as it is until the 8th Pay Commission is formed. Instead of the merger, there are provisions of increasing allowances, including HRA, in case of DA crossing 50 per cent, which has already been increased, according to the people in the know of the matter.
DA is given to government employees, while DR is given to pensioners. DA and DR are hiked twice a year, with effect from January and July.