7th Pay Commission: DA Increase and What to Look Forward to in 2024

The increase in DA is one of the prime indicators for the central government employees to whom this announcement month after month allows the sustenance of the increasing cost structure. As these new improvements are likely to be in October 2024, the employees will like to know their realistic prospects of a hike and the quantum of increase provided to them.

What is Dearness Allowance (DA)?

Dearness Allowance is that percentage of the basic wages of the central government and it is given to cope with the rise in the cost index. It is also changed every six months by taking into account the changing index of the cost of living.

When will the Next DA Hike occur?

Speculations have pointed to October 2024 and it is expected before the festival of Diwali as the hike in DA. DA has normally been announced at the beginning of this month and expectations are that it may fall within this range between 3%- 4%. Though, no official support has been made yet.

Since 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. The same timing of betterment can be anticipated in the next year, that is in 2024 for government employees and pensioners.

How the DA Hike Functions

The DA hike generally affects the total remuneration of pay that the employees get. For instance, if a worker receives a minimum wage of ₹ 18,000, the prevailing DA amount will be ₹ 9,000, which is half of the wage. The workers may agree on a 3% increment; thus when the government declares this hike, the new DA will shoot up to ₹ 9,540. Similarly, an increase of 4% would provide ₹720 towards the DA the new DA, or the revised DA, would jump up and would be at ₹9,720.

Frequency of DA Hikes

It is ranked according to the position or job a worker holds. It is evaluated by the government twice in the year – once in July and once in January but the announcements occur either in March or October. The DA hike which usually starts in January coincides with Holi, and the hike that will be implemented in July falls during Diwali.