7th Pay Commission Latest Update: Govt to announce DA hike on THIS day

7th Pay Commission: Great news is coming for those 50 lakh employees and 65 lakh pensioners who are waiting for a hike in their salary and other changes in their payment.

As per a latest report by Zee News, lakhs of central government employees are likely to see an increase in their dearness allowance (DA) in the month of July 2022. Apart from DA hike they also may receive 18-month-old arrears and interest rate for Provident Fund.

The DA is revised based on the changes in the All India Consumer Price Index (AICPI). Now, as the AICPI is prevailing high, the chances of government employees getting a raise in dearness allowance is also high. The retail inflation in May stood at 7.04 per cent, which is above the RBI’s comfort level of 2-6 per cent.

According to lates media reports, there may be an increase of 6 percent in the Dearness Allowance (DA) of Central employees and Dearness Relief (DR) of pensioners in July. If there is an increase of 6 percent in DA, then your salary will increase.

Now, after another six per cent hike, the dearness allowance for the government employees will increase from 34% to 40%.

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Employees of the central government have their Dearness Allowance is revised twice a year. The first is given from January to June, while the second comes from July to December.In April 2022, the All-India CPI-IW rose by 1.7 points to 127.7.

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According to data from the Ministry of Labour & Employment, the 1-month percentage change climbed by 1.35 percent compared to the 0.42 percent increase between the same months a year before. The DA would undoubtedly exceed expectations if the AICPI statistics for May climb. In March, the first dearness allowance rises for the year 2022 was announced. The AICPI value in December 2021 was 125.4.

Demands For Fitment Factor

Apart from this the government employees’ association also demanding for long time that the fitment factor be increased from 2.57 times to 3.68 times.

If their demand is accepted, then the minimum wage of central government employees will be increased from Rs 18,000 to Rs 26,000. At present the minimum basic pay is Rs 18,000.

What is fitment factor?

Fitment factor is a figure used by 7th Central Pay Commission (CPC) with which the basic pay in 6th Central Pay Commission regime (Pay in Pay band + Grade pay) is multiplied in order to fix basic pay in revised pay structure (7th CPC). Fitment factor formulated by 7th Central Pay Commission is 2.57.

1: Hike in DA of 5% – 6%  likely in July

As per the All-India Consumer Price Index (AICPI) data this year, the central government employees will receive a large DA boost of 5%. This percentage is more than the previously predicted 4% increase. If the AICPI data for May will rise, then this figure might rise to 6%.

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With the predicted 5% increase, DA, which is currently at 34% following a 3% increase in January of this year, would rise to 39%. If this rises to 6%, it will be a huge boost in the face of growing inflation in India and around the world. On the basis of the base income of employees, such a raise would represent a rise of up to Rs 3,400 per month, or little more than Rs 40,000 annually.

2: Pending DA Arrears

Apart from DA hike, it is also being reported that the settlement of 18-month-old Dearness Allowance (DA) arrears will also be released in July this year. The employees of the Central Government should not give up hope of receiving Rs 2 lakh in pending arrears in a single payment.

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3: Provident Fund Interest Rate

The EPFO and the Central Board of Trustees have suggested an annual rate of interest of 8.10 percent to be credited on EPF accounts of the PF subscribers for the fiscal year 2021-22. It is also reported that the PF interest rate will be credited to the accounts of the government employees in July 2022.

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