The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday (October 1), has approved a three per cent hike in Dearness Allowance (DA) and Dearness Relief (DR) for central government employees and pensioners. This will take effect retrospectively from July 1, 2025.
With the latest increase in DA, the rate jumped to 58 per cent from 55 per cent of basic pay and pension. The government will give arrears for July, August, and September alongwith the October salary.
Who will get the benefit?
All the central government employees under the 7th Pay Commission, as well as pensioners and family pensioners, will get the benefit of the DA hike.
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Why government increases DA and DR
Dearness Allowance (DA) and Dearness Relief (DR) are revised twice a year by the government to protect employees and pensioners from inflation. The rate hike is based on the Consumer Price Index for Industrial Workers (CPI-IW) released by the Labour Bureau.
Also Read: Cabinet clears 3% DA hike, bigger pay from July
DA hike calculations on basic pay
Total salary on Rs 26,500 basic pay (at 55% and 58% DA)
We are not calculating any other allowances such as house rent allowance (HRA) and travelling allowance (TA). These are projections as actual calculations may vary.
| Basic Pay | Rs 26,500 |
| DA at 55% | Rs 14,575 |
| Total pay | Rs 41,075 |
| DA at 58% | Rs 15,370 |
| Projected revised salary | Rs 41,870 |
Total salary on Rs 36,500 basic pay (at 55% and 58% DA)
| Basic Pay | Rs 36,500 |
| DA at 55% | Rs 20,075 |
| Total pay | Rs 56,575 |
| DA at 58% | Rs 21,170 |
| Projected revised salary | Rs 57,670 |
Total salary on Rs 46,500 basic pay (at 55% and 58% DA)
| Basic Pay | Rs 46,500 |
| DA at 55% | Rs 25,575 |
| Total pay | Rs 72,075 |
| DA at 58% | Rs 26,970 |
| Projected revised salary | Rs 73,470 |
FAQs
What is DA?
It is an allowance given to central and state government employesto offset inflation.
What is DR?
DR is also an allowance that is given to government pensioners.
Do pensioners get the same hike as employees?
Yes, the percentage remains same for both employees an pensioners.
What is CPI-IW Index?
It is an index taken as a benchmark to calculate DA for central government employees. Governed by the Labour Bureau of the Ministry of Finance, the index issues monthly readings of DA for Centre and states.