7th Pay Commission News: Central Government Employees Likely To Get DA Hike This Festive Season

7th Pay Commission News: In what can be a cheering moment for the central government employees ahead of the festive season amid pandemic, the union government is mulling at changing the base year for the consumer price index (CPI) for industrial workers (IW) leading to a likely increase in allowance of CG employees and staff under the 7th Pay Commission (7th CPC).

If the Centre goes ahead with the move of making 2016 as the base year, the dearness allowance (DA) of the CG employees in likely to be increased contributing to enhancement in their salaries as their DA is directly linked to the way CPI-IW is calculated.

"The government is going to prepare new Consumer Price Index for Industrial Workers (CPI-IW) with 2016 as the base year. New CPI-IW Index numbers is likely to be issued on October 21," according to a top Labour Ministry official as per media reports.

The Centre calculates dearness allowance (DA) with the help of CPI-IW Index, and if the government has its way in implementing the new CPI-IW rule, the dearness allowances (DA) of CG employees will be enhanced.

Nearly 48 lakh central government employees are likely to be benefited by the move. Currently, the CG employees are entitled to dearness allowance (DA) at the rate of 17 per cent.

In March, the Union Cabinet, had approved a 4 per cent hike in the DA and DR of central government (CG) employees and pensioners (7th pay commission) respectively, over the existing 17 per cent taking it to 21 per cent, which stood cancelled July 2021 due to COVID-pandemic.

Recently, the central government in a bid to augment consumer spending and stimulate demand in the economy has announced a festival advance of Rs 10,000 to all its employees and officers while rolling out the LTC Cash Voucher scheme.

Under the Special Festival Advance Scheme, all central government employees, both gazetted and non-gazetted, are entitled to get an interest-free festival advance of up to Rs 10,000 in the form of a pre-paid RuPay Card to be spent by March 31, 2021, and recoverable in maximum 10 instalments.