Central government employees have been eagerly awaiting a Dearness Allowance (DA) hike, and their wait may finally end today. The Union Cabinet is expected to approve a 2% increase in DA during its meeting on March 28, 2025. With this revision, DA is set to rise from 53% to 55%, providing a significant salary boost ahead of the anticipated 8th Pay Commission. The last DA hike was implemented in July 2024, when it increased from 50% to 53%.
What is DA?
Dearness Allowance (DA) is a financial benefit granted to government employees to help offset the impact of inflation. While basic salaries are revised every 10 years by a Pay Commission, DA ensures periodic adjustments to maintain employees’ purchasing power.
How Often Does the Government Increase DA?
The government revises DA twice a year based on inflation data. Though the announcement may be delayed, DA rates are calculated using the All India Consumer Price Index (Industrial Workers) for January and December.
What is the AICPI (IW) Index?
The All India Consumer Price Index (Industrial Workers) (AICPI-IW) is a key metric used to determine DA. Managed by the Labour Bureau under the Ministry of Finance, this index provides monthly inflation readings that guide DA adjustments for both central and state government employees.
Will State Government Employees Also Get a DA Hike?
The Cabinet’s approval applies only to central government employees. However, many states follow the Centre’s decision and adjust their DA rates accordingly, while some states may implement independent increases.
Projected Salary Hike at 55% DA
| Basic Pay | DA at 53% | Total Pay | DA at 55% | Projected Revised Salary |
|---|---|---|---|---|
| ₹24,600 | ₹13,038 | ₹37,638 | ₹13,530 | ₹38,130 |
| ₹37,500 | ₹19,875 | ₹57,375 | ₹20,625 | ₹58,125 |
| ₹54,300 | ₹28,779 | ₹83,079 | ₹29,865 | ₹84,165 |
| ₹71,700 | ₹38,001 | ₹1,09,701 | ₹39,435 | ₹1,11,135 |
Note: These calculations include only basic pay and DA. Other allowances like House Rent Allowance (HRA) and Travel Allowance (TA) are not included.
