Mumbai, March 6: The central government is expected to announce an increase in Dearness Allowance (DA) and Dearness Relief (DR) for employees and pensioners under the 7th Pay Commission before the Holi festival. Reports suggest that the official announcement could come in the next few days, following the government's routine of revising DA twice a year—in January and July.

Typically, the January revision is announced around Holi, while the July adjustment is made before Diwali. The adjustments aim to counter inflation and safeguard the purchasing power of government employees and retirees. Based on data from December 2024, a 2% increase is anticipated, which would raise the DA and DR to 55% in line with the 7th Pay Commission. However, the final decision will be made by the Union Cabinet, led by the Prime Minister. 8th Pay Commission: How Much Salary Hike Can Central Government Employees Expect? All You Need To Know.

How is DA Rate Calculated?

The DA rate is calculated using the All India Consumer Price Index for Industrial Workers (AICPI-IW), with formulas based on average indices over specified periods. In March 2024, the government raised the DA from 46% to 50%, and another increase in October 2024 brought it to 53%, effective from July 1, 2024.

Looking ahead, the 8th Pay Commission is set to be implemented in 2026, with expectations that it may merge DA into the basic pay structure. Its recommendations are anticipated to be finalised by the end of the current financial year. Before this transition, three more DA hikes are expected under the 7th Pay Commission - two in 2025 and one in 2026. 8th Pay Commission: Massive Salary Hike on Cards for Central Government Employees, Here’s What To Expect.

Despite speculation surrounding the DA hike, discussions on the matter were notably absent during the Cabinet meeting in New Delhi on March 5, 2025. The government had previously announced the formation of the 8th Pay Commission in January 2025, which will review salaries and allowances for central government employees, consulting with representatives to address their concerns before finalizing its proposals.

(The above story first appeared on LatestLY on Mar 06, 2025 05:52 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).