The Union Cabinet, led by Prime Minister Narendra Modi, had earlier approved a 2% hike in Dearness Allowance (DA) and Dearness Relief (DR) for central government employees and pensioners under the 7th Pay Commission in March this year.
What Has Changed?
This DA/DR hike became effective from January 1, 2025, meaning arrears for the period starting from January were provided to employees and pensioners.
With this revision, the DA/DR rate rose to 55%, benefiting more than 48 lakh central government employees and over 66 lakh pensioners.
Under the 7th Pay Commission:
The minimum basic pay is ₹18,000.
The minimum basic pension is ₹9,000.
So, after the DA/DR hike:
Employees now get ₹27,900 per month (₹18,000 basic + 55% DA).
Pensioners now receive ₹13,950 per month (₹9,000 basic + 55% DR).
DA/DR Increases Happen Twice a Year
The central government typically revises DA/DR twice annually — once from January 1 and again from July 1.
Looking at previous trends, the next DA/DR hike is expected around September 2025, following the July cycle.
What’s Expected from the Next Hike?
As per media reports, the next DA/DR hike could be around 3%, pushing the rate up to 58%.
Here’s what that would mean:
On a basic salary of ₹18,000, a 3% DA hike adds ₹540, bringing the total to ₹28,440 per month.
For pensioners with a basic pension of ₹9,000, a 3% DR hike adds ₹270, making the total pension ₹14,220.
8th Pay Commission Status
In January 2025, the government approved the 8th Central Pay Commission, but no official notification has been issued yet.
As of now, the Chairman and members of the new commission are yet to be appointed.
Minister of State for Finance, Pankaj Chaudhary, confirmed in the Rajya Sabha that the official notification for the 8th Pay Commission will be released in due course.
