7th Pay Commission: Latest AICPI figure disappoints central employees, what it means for 2023 DA hike

The latest figures for the AICPI index were released recently and it did not come as great news for central government employees. The All-India Consumer Price Index is the basis on which the hike in Dearness Allowance for government employees is decided. A DA hike of at least 4 percent was expected on the back of rising inflation but the increment could be less now.

It can be called a significant setback for lakhs of central government employees and pensioners who receive DA and DR benefits to alleviate some of the burden of rising prices. It was expected that the DA hike matching the figure of 2022’s second hike would be received. After a 3 percent hike the first time around, central employees got a big Diwali 2022 bonanza with a 4 percent hike.

It was expected that the first round of DA hike in 2023 would surpass the DA figure of 2022. The AICPI index kept rising from March to October 2022. However, the AICPI index has stabilised in November 2022 instead of keeping up with the upward trend. AICPI stays put at 132.5 from October to November 2022. Now, all eyes will be on the AICPI Index for December 2022.

Without a jump in the AICPI numbers, central government employees cannot expect a bigger DA hike than 2022 under the 7th Pay Commission rules. It is unlikely that the AICPI index figure will reach 133.5 in December 2022, Zee Business reported citing experts. In such a scenario, central employees are likely to have to make do with a 3 percent DA hike instead of the anticipated 4 percent hike.

Meanwhile, the first DA hike of 2023 will likely be announced in March. As per latest reports, the date could be March 1, 2023, which is a week before the Holi festival. This means, the government could bring DA delight to central employees with good festive fortune. A cabinet meeting may be held on the issue on March 1, it was also reported. The hike will be effective from January 2023 once it is announced in March. The hike sums for January and February will be received as arrears by the central government employees. 

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