- By Aditya Pratap Singh
- Thu, 06 Mar 2025 11:06 AM (IST)
- Source:JND
7th Pay Commission News: The central government may soon announce a hike in dearness allowance (DA) and dearness relief (DR), which will benefit over 1 crore central government employees and pensioners. As per several media reports the official announcement is likely to be made in the days before Holi. The expected increase in dearness allowance will be announced amid euphoria around 8th pay comission that government had pledge to set-up to revise employees wages.
DA hike expected Before Holi
The DA is revised twice a year - in January and July - but the announcements often come later. The January revision is usually announced around Holi, while the July revision is announced closer to Diwali. This time, based on the Consumer Price Index for All India Industrial Workers (AICPI-IW) data for December 2024, it is expected that there will be a 2% hike, taking the DA and DR to 55% of the basic pay. However, the final decision will be taken by the Union Cabinet headed by the Prime Minister.
Recent DA hikes
In March 2024, the Cabinet increased DA from 46% to 50% in time for the festival of Holi.
In October 2024, another 3% hike was approved, taking the DA to 53%, effective July 1, 2024.
DA hikes are calculated using AICPI-IW data, which reflects changes in the cost of living. The government reviews index data for the past six months before finalising DA hikes. The upcoming hike is based on December 2024 AICPI-IW data, which show a 2% increase.
8th Pay Commission and future DA hikes
With the 8th Pay Commission set to be implemented in 2026, there has been speculation about DA being reintroduced and merged with the basic pay. The commission's recommendations are expected to be finalised by the end of the current financial year, with implementation likely in the next fiscal year.
Before that happens, the government may announce three additional DA hikes under the 7th Pay Commission - two in 2025 and one in 2026. These adjustments will help employees and pensioners manage inflationary pressures. The upcoming announcement will be closely watched as it will directly impact the financial well-being of millions of government employees and pensioners.
