New Delhi, October 26: Ahead of Diwali, the Centre has announced a good news for central government employees who get paid as per the 7th Pay Commission recommendations. The Union Cabinet approved a hike of 3 percent in the rate of dearness allowance (DA) last week. The increment, which will be considered effective from July 1, will result in big hike in salary of central government employees. Check the calculation below. 7th Pay Commission: Good News Regarding DA, DR Arrears Likely Soon, PM Narendra Modi to Take Final Call.

Recommended by the 7th Pay Commission, the basic salary of central government employees ranges from Rs 18,000 to a maximum of Rs 2,25,000. They used to get 28 percent of their basic pay as DA. Following the Centre's decision to hike the rate of DA by 3 percent, they will now get 31 percent of their basic pay as dearness allowance. This will result in monthly hike up to Rs 6,750 in salary of central government employees, based on their basic pay.

A central government employee, whose basic salary is Rs 18,000 per month, will now get a hike of Rs 540 in his/her monthly take-home salary. It also means annual hike of Rs 6,480. Similarly, an employee whose basic income is Rs 2,25,000 will receive monthly hike of Rs 6,750 in his salary, meaning Rs 81,000 extra annually.

Monthly and Annual Salary Hike Calculation Based on 31% DA

If Basic Salary of Employee Is Rs 18,000:

  • Existing Dearness Allowance (28%) Rs 5040/month

  • New Dearness Allowance (31%) Rs 5580/month

  • Calculate the difference: 5580-5040 = Rs 540/month

  • Increase in annual salary 540X12 = Rs 6,480

If Basic Salary of Employee Is Rs 2,25,000:

  • Existing Dearness Allowance (28%) Rs 63,000/month

  • New Dearness Allowance (31%) Rs 69,750/month

  • Calculate the difference: 69,750 - 63,000 = Rs 6,750/month

  • Increase in annual salary 6,750 X 12 = Rs 81,000

For retired central government employees, under the 7th Pay Commission, the Centre increased the rate of dearness relief to 31 percent. The increased rate of DA and DR will cost the exchequer Rs 9,488.70 crore annually, as per the government.

(The above story first appeared on LatestLY on Oct 26, 2021 01:08 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).