DA Hike 2026: Government increases Dearness Allowance; the hiked DA will be included with the October salary..
DA Hike 2026: There is great news regarding the Dearness Allowance (DA) amidst the festive season. The Kerala government has officially announced a 2% increase in the Dearness Allowance and Dearness Relief (DA/DR). With this hike, the DA for employees has risen from 35% to 37%. This new order will be effective from January 1, 2026, and is expected to provide significant relief to lakhs of state employees amidst rising inflation.
DA/DR to be paid with an increase starting in November
According to the order issued by the Finance Department, this increased DA will be paid to employees along with their October salary in the month of November. Meanwhile, pensioners will receive the revised Dearness Relief (DR) along with their pension for November 2026.
Earlier this year, in February 2026, the DA had been increased from 25% to 35%. Local bodies will cover this additional expenditure from their own funds. Furthermore, a separate order will soon be issued by the government regarding the arrears accumulated since January 1, 2026.
Who will benefit from the increased DA?
All regular state government employees and teachers.
Employees of aided schools, private colleges, and polytechnics.
Full-time contingent employees and those working in local bodies.
Additionally, state service pensioners, family pensioners, ex-gratia pensioners, and ex-gratia family pensioners will also receive the full benefit.
Part-time teachers, part-time contingent employees, and re-employed pensioners will also be granted this increased DA, based on their respective salaries.
Rules for PSUs and Autonomous Bodies
Employees and pensioners of state-run Public Sector Undertakings (PSUs), statutory corporations, autonomous bodies, boards, and grant-in-aid institutions—provided they follow the state’s Dearness Allowance (DA) pattern—also fall within this scope.
However, for these organizations, the implementation is subject to the decisions of their respective governing bodies and their own financial standing. Institutions unable to bear this additional expenditure on their own must seek government approval. Conversely, institutions that rely on government grants for more than 90% of their total expenditure are permitted to implement it directly.
Who will not benefit from this DA hike?
This increased DA will not automatically apply to certain specific organizations—most notably the Kerala State Electricity Board (KSEB) and the Kerala State Road Transport Corporation (KSRTC). According to reports, these institutions have been instructed to issue separate orders regarding DA and Dearness Relief (DR) for their own employees.
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