7th Pay Commission: In some major good news for central government employees the Union government is likely to increase the Dearness Allowance (DA) and Dearness Relief (DR) by 4 percent under the 7th Pay Commission regime. The announcement is expected to be made in August but the benefits will be implemented from July itself according to reports. How much will be DA hike for central govt employees? The DA hike will depend on the All India Consumer Price Index (AICPI-IW) which increased by by 0.5 points to 144 in May 2025. The index has increased for three consecutive months from 143 in March 143.5 in April and 144 in May. Considering this trend its likely that dearness allowance could increase from 3-4 percent from July. The final DA hike will be determined by June 2025 AICPI-IW data which will be released in August. In case of a 3 percent increase the DA will be hiked to 58% from the current 55% while a 4 percent hike would mean a 59% DA for central government employees. When will the DA hike be announced? The CPI-IW data for June is expected in late July or early August which would give the Union Cabinet a basis to decide the dearness allowance hike under the 7th Pay Commission regime. The announcement is likely to come in mid-August but the hike along with arrears from July are expected to be available to employees by late September or early October 2025. What about 8th Pay Commission? If we go by previous implementation of previous pay commissions it usually takes about 18 to 24 months for the government to implement the recommendations. Thus its unlikely that 8th Pay Commission would be implemented before 2027.