The Union Cabinet, headed by Prime Minister Narendra Modi, on March 28 approved a 2% increase in the dearness allowance (DA) for central employees and dearness relief (DR) for pensioners, according to sources. This hike in DA and DR will be effective retrospectively from January 1, 2025, for over 1 crore serving central government employees and pensioners. Since this hike announcement is already delayed by at least 15-20 days, the salary and pension for the month of April will see increased DA along with arrears for three months (January to March 2025).
DA increase less than expected
The government usually announces DA hike biennially before festivals like Holi and Diwali every year, and but this time the January-June cycle hike was not announced before the Holi festival. As far as the quantum of increase is concerned, this is the lowest increase in the last 7 years. Since July 2018, the government had been increasing at least 3% or 4% every time, but this time it has increased by only 2%.
How much will employees and pensioners get?
With this 2% increase, DA will now increase from 53% to 55%. There will be a similar increase in Dearness Relief (DR) for pensioners as well. If an employee’s basic salary is Rs 18,000, he will now get Rs 360 more per month (2% of Rs 18,000), that is, a benefit of Rs 4,320 annually.
Similarly, if a pensioner’s basic pension is Rs 9,000, he will get Rs 180 more per month, which will increase by Rs 2,160 in a year.
Also read: 8th Pay Commission: Fitment factor may rise to 2.86 but govt employees’ salary won’t – Here’s why
First DA hike after announcement of 8th Pay Commission
This is the first DA hike after the announcement of the 8th Pay Commission. The government had announced the formation of the 8th Pay Commission on January 16, 2025, which will come into effect from January 1, 2026. It may take at least a year for the new recommendations to come in, meaning the next DA hike (for July-December 2025 cycle) due later this year around Diwali will be the last under the 7th Pay Commission.
What next for central govt employees?
Now the government will make a second DA hike for the July-December period in October-November 2025.
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