Central employees and pensioners across the country are expected to get a hike in dearness allowance (DA) in July this year. The government has already announced a 2% hike in DA for the first half of the current financial year, and now there are indications of further increase in DA in July. Currently, central employees get 55% DA, which is a part of their basic salary.
Background of DA hike
The 7th Pay Commission will complete its term in December this year, so this DA revision in July will be the last under this commission. The Industrial Consumer Price Index (AICPI-IW) data for March and April 2025 has registered a steady increase, which strengthens the possibility of a DA hike in July.
How much can DA increase?
The index has increased by 0.2 points in March and 0.5 points in April. If the figures for May and June also increase at the same pace, then from July DA can increase from 55% to about 57.95%, i.e. an increase of about 3% is possible.
Current form of Dearness Allowance
At present, central employees are given 55% of their basic salary as Dearness Allowance. For example, if an employee’s basic salary is ₹ 20,000, then he gets ₹ 11,000 as DA, which makes the total salary ₹ 31,000. Dearness Allowance is deposited in the account of the employees every month along with the salary.
When will the new DA be implemented?
The government plans that the second DA installment of 2025 will come into effect from July 1. However, the official announcement may be made around Diwali in October or November. This increase will provide financial support to central employees and pensioners, especially in the era of rising inflation.
