7th Pay Commission: New Year 2025 may herald significant positive developments for central government employees. Both central employees and pensioners are anticipating an increase in the Dearness Allowance (DA).
The DA, as per the 7th Pay Commission, is determined based on the All India Consumer Price Index (AICPI). The AICPI figures from July to December 2025 will play a crucial role in this determination. Preliminary data available until October 2024 suggests a potential 3% increase in DA come January 2025, although the figures for November and December are still pending.
Should the AICPI remain around 145 in those months, the DA could rise to 56% in January 2025. The AICPI serves as the primary metric for adjusting the DA for central employees, with the index recorded at 144.5 points in October 2024. Analyzing the previous month’s data indicates that the government may elevate the DA from 53% to 56% in the upcoming year. A 3% increase in the dearness allowance would result in a substantial monthly salary boost for central employees.
DA rivision based on 7th Pay Commission
Under the 7th Pay Commission, the dearness allowance is revised biannually, in January and July, based on the average AICPI index. For the January 2025 revision, the AICPI figures from July to December 2024 will be considered.
The AICPI stood at 143.7 in September 2024 and increased to 144.5 in October 2024, bringing the DA close to 55.05%. If the index rises by one point in November 2024, it would reach 145.5, resulting in a DA of 55.63%. A further increase of 0.50 points in December would elevate the index to 146, leading to a DA of 56.29%. However, these projections hinge on the official figures released in December.
When the government can make announcement?
The government might issue the announcement prior to Holi. However, pinpointing the exact timing of the announcement remains challenging until the final figures are available. Following the announcement in March, it could be incorporated into the employees’ salaries for April 2025. Pensioners will also benefit from this adjustment.