7th Pay Commission: Central government employees can get good news about their salary on the new year.
7th Pay Commission: Central government employees can get good news regarding their salary on the new year. Basic pay of employees may increase. If media reports are to be believed, the Modi government is also considering increasing the fitment factor. The fitment factor decides the basic salary for all central government employees. If the Modi government increases the fitment factor, then the minimum basic salary of the employees i.e. basic salary can increase to 26,000.
Minimum Basic Pay will be Rs 26 thousand
If the central government increases the fitment factor, then the salary of central employees will automatically increase. The fitment factor decides the basic salary for all central government employees. The fitment factor was last raised in 2016, wherein the minimum basic pay of employees was increased from Rs 6,000 to Rs 18,000. A possible increase in the fitment factor could lead to a minimum basic pay of Rs 26,000. At present, the minimum basic pay is Rs 18,000, which will increase to Rs 26,000.
Allowances will increase
If the basic pay increases from Rs 18,000 to Rs 26,000, the dearness allowance will also increase. Dearness Allowance (DA) is equal to 31 per cent of the basic pay. DA is calculated by multiplying the DA rate by the basic pay. That is, due to increase in basic salary, dearness allowance will automatically increase.
Government may increase DA next year
According to media reports, the central government may announce to increase DA by 3 percent in early 2022. A hike of 3 per cent could lead to an increase in salaries of government employees by up to Rs 20,000. Under the 7th Central Pay Commission, the DA of government employees is calculated on the basis of basic pay. The current DA rate stands at 31 per cent, after a hike of 3 per cent in October and 11 per cent in July.
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