DA Hike in July: If you yourself are a central government employee or any member of your family is in job, then this news is of your use. Yes, central employees have started waiting for the dearness allowance to be increased from July 1.
Most of the times, the DA which is increased in September-October is implemented from July 1. According to the recent inflation data, central government employees are likely to get a 4% increase in dearness allowance (DA) from July 2025. After this hike, their DA will increase from the current 55% to 59%. The DA hike is expected to be announced by the government during the festive season.
Dearness allowance is expected to be 59%
Dearness Allowance (DA) is calculated on the basis of All India Consumer Price Index (AICPI-IW). In May 2025, it has increased by 0.5 points to reach 144. This index has been increasing continuously in the last three months. It reached 143 in March, 143.5 in April and 144 in May. If this index also increases to 144.5 in June, then the 12-month average of AICPI-IW will be around 144.17. If it is seen according to the formula of the 7th Pay Commission, then the rate of DA will be around 58.85%. In such a situation, the government can approve 59% DA from July 2025.
How does Dearness Allowance (DA) increase?
As per the recommendation of the Seventh Pay Commission, Dearness Allowance (DA) is increased twice a year, in January and July. It is calculated on the basis of the average data of AICPI-IW of the last 12 months.
The formula for calculating DA
is (DA (%) = [(Average CPI-IW of the last 12 months – 261.42) ÷ 261.42] × 100). Here, 261.42 is the base price for calculation. By calculating in this way, an increase of 4% in DA is currently being estimated.
The increase in dearness allowance (DA) will be implemented from July. But it is usually announced later. In previous years too, the government has made such announcements during the festive season in September or October. This year too, the DA is expected to be announced around Diwali. This will be the last DA hike under the Seventh Pay Commission, as its term ends on 31 December 2025. The Eighth Pay Commission has been announced in January. The government has to appoint the chairman and members of the new commission.
The implementation of the Eighth Pay Commission may take time.
Looking at the past experience, the new pay commission usually takes 18 to 24 months to submit its report and implement it. If this time frame is applied, then the recommendations of the Eighth Pay Commission are likely to be implemented only by 2027. This means that till then central employees and pensioners will continue to get an increase in dearness allowance (DA) on their existing basic salary.
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