DA Hike: Government employees' dearness allowance will increase next week! Salaries will increase by this much

DA Hike Likely Next Week: Central Government Employees May See 3% Increase in Dearness Allowance Before Diwali

New Delhi, September 27, 2025: After approving a Diwali bonus for railway employees, all eyes are now on the Central Government’s decision regarding the long-awaited Dearness Allowance (DA) hike for lakhs of employees and pensioners. Expectations are high that the government could announce the increase as early as next week, ahead of the festive season.

Employees Waiting for DA Hike and Bonus

Following the Cabinet’s approval of a performance-linked bonus equivalent to 78 days’ wages for railway employees, central government employees have become increasingly eager for their turn. Traditionally, the Centre announces a hike in DA and Dearness Relief (DR) before Diwali, ensuring higher pay and pensions just in time for the festival. However, this year no official notification has been issued yet, leading to growing impatience among employees.

The Confederation of Central Government Employees and Workers (CCGEW) has also expressed concern over the delay. General Secretary S.B. Yadav said that normally the DA or DR revision is declared in the last week of September, and the arrears for three months (July–September) are disbursed in early October. Any further postponement is causing dissatisfaction among employees.

Expected Increase in DA and DR

If approved, the government is expected to raise DA and DR by 3 percentage points, taking the rate from 55% to 58%. This hike will directly increase the take-home salary of employees and the pension of retired staff. With inflationary pressures still high, such an increase will provide much-needed relief to households struggling with rising costs.

Why Dearness Allowance Matters

Dearness Allowance is a critical component of a government employee’s salary. It is designed to offset the impact of inflation on household budgets. The calculation is based on the Consumer Price Index for Industrial Workers (CPI-IW), and revisions are made twice a year — for the periods January to June and July to December.

For employees, even a small percentage hike translates into a significant increase in monthly income. For pensioners, DA is converted into Dearness Relief (DR), ensuring that retirees also receive financial support to cope with rising expenses.

Last Hike Under the 7th Pay Commission

The upcoming revision for July–December 2025 is set to be the final hike under the 7th Pay Commission. From January 2026, the 8th Pay Commission is likely to come into effect, bringing fresh changes to pay structures, allowances, and pension benefits. This makes the current DA increase especially significant, as it marks the closing chapter of the 7th Pay Commission cycle.

Timing of the Announcement

Although the Cabinet cleared bonuses for railway staff on September 24, no decision was announced on DA and DR. However, going by tradition, the Centre is expected to make the announcement before the end of September. If implemented, employees could receive arrears for three months along with their October salary, just ahead of Diwali celebrations.

Key Highlights

• DA/DR likely to rise by 3%, from 55% to 58%.

• Salary and pension hikes will benefit lakhs of central government employees and pensioners.

• DA is revised twice a year, based on CPI-IW inflation data.

• This will be the last revision under the 7th Pay Commission.

• The 8th Pay Commission is expected to take effect from January 2026.

• Employees may receive arrears for July–September 2025 in October.

Conclusion

If the government announces the DA hike next week, it will come as a festive gift for central government employees and pensioners across the country. The increase will not only improve financial stability but also boost festive spending during Diwali. With inflation still weighing on households, the decision could bring significant relief and double the joy of the festive season.