Dearness allowance (DA) and dearness relief (DR) are revised twice a year, effective January 1 and July 1. (Representative photo)
The Tamil Nadu government’s DA hike will benefit 16 lakh government employees and would entail an additional expenditure of Rs 2,366.82 crore annually to the exchequer
7th Pay Commission: The Tamil Nadu government has approved a 4 per cent hike in dearness allowance (DA) for state government employees. The move, which would entail an additional expenditure of Rs 2,366.82 crore annually to the exchequer, will benefit 16 lakh government employees, teachers, pensioners and those receiving family pensions.
The hike comes into effect retrospectively from the start of the financial year, April 1, 2023. The DA was increased from 38 per cent to 42 per cent, according to an official statement. Further, in the future, the state government will effect a DA increase whenever the Central government does so.
Before this, Himachal Pradesh and Rajasthan governments have also raised their dearness allowances.
For central government employees, the last revision in DA was done in March raising it by 4 per cent, which became effective from January 1, 2023. After the 4 per cent hike, the DA of central government employees increased to 42 per cent. Before this, the DA was hiked in September 2022 by 4 per cent, which became effective from July 2022.
Dearness allowance (DA) and dearness relief (DR) are revised twice a year, effective January 1 and July 1. According to recent media reports, the government is likely to raise the dearness allowance by another 4 per cent in July this year.
Apart from this, the government might also raise fitment factor to raise minimum salary. The minimum salary of government employees is expected to see a rise from Rs 18,000 to Rs 26,000 for central government employees after the hike in the fitment factor, according to the reports. The reports said that the government is expected to revise the fitment factor and dearness allowance (DA) soon. However, there is no official word on this.
How DA Hike is Decided?
The central government revises the DA and DR for employees based on a formula. Following is the formula:
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.
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