Central employees and pensioners have good news. The increase in Dearness Allowance is going to bring a 3 percent hike and make it a total of 56 percent. Such an increase was stated with respect to the AICPI data from July to October for the year 2024. The data for November and December is yet to be collected. Only with this can one judge how much dear allowance is entitled to reach the employees and pensioners in January 2025. However, such an initiative is going to prove helpful for the employees in the fine way of relation with finances.
Dearness allowance is revised every year by the central government, for both central employees and pensioners, two times a year, based on the All India Consumer Price Index. This modification takes place every January and July and is announced accordingly in March and October.
In the year 2024, it increased by 4% in DA as of January and 3% in July, making the figure reach 53%. The next increase will be in January 2024, which will likely be known just after the upcoming Budget 2025-26. Therefore, DAs are the most significant portion of dearness relief for employees.
Dearness allowance likely to increase by 3-4 percent.
At present, 48 lakh central government employees and 68 lakh pensioners benefit from this 53% DA. The new Dearness Allowance to be announced from January 2025 is dependent on the AICPI Index data of July-December 2024.
The AICPI Index score has reached 144.5 from July to October, and DA stood 55.05%. Hence, with this calculated situation, an increase of 3% will definitely happen in DA. However, figures for November and December are yet to come.
This usually happens at the end of the year on 31 December 2024 when the Ministry of Labor releases November figures. However, the data release has been delayed this time. It is expected that such combined December November could now be released in January. Then it will be decided what will be the percentage hike in DA.
Salary pension is all set to see a big boost.
Central employees are and will continue to enjoy the benefits of 53% dearness allowance since July 2024. As per estimates, dearness allowance may increase by 3 to 4% during January 2025, which would take the DA figure to 56 or 57%. The announcement regarding such increases is expected around Holi in March. Such changes will be made as per the 7th Pay Commission. Thus, the employees and pensioners will have a good deal in dealing with inflation.
Such increases include the increase in DA for employees. For instance, if the minimum salary is Rs 18,000, a 3% increase will bring the increase to Rs 540. At the same time, a maximum salary employee earning Rs 2,50,000 will get an increase of Rs 7,500. Apart from these, the pensioners too will get relief with a jump in their pension from Rs 270 to Rs 3,750. This increase will put employees and pensioners in a better financial position than they are at present, raising their standard of living.
Calculation of dearness allowance:
The increase in DA and DR is determined by the percentage increase in the 12-month average of the All India Consumer Price Index for Industrial Workers. The government generally reviews these allowances twice a year i.e. on January 1 and July 1.
Calculation of DA of Central Government Employees- DA%=[(Average of AICPI(Base year 2001=100) for last 12 months-115.76)/115.76] x 100
DA for public sector employees is calculated like this- DA% = [(Average of AICPI (Base Year 2001 = 100) for the last 3 months – 126.33)/126.33] x 100
