The biggest piece of good news of the festive season is about to arrive for over 10 million central government employees and pensioners. The wait is now over. According to sources, the government has almost finalized the date for approving the next Dearness Allowance (DA) hike.
So take out your diaries and note this date—October 15, 2025. Yes, a bumper increase in your dearness allowance is going to be announced in the Cabinet meeting just before Diwali. This decision will bring a smile to your face and extra money in your pocket.
Why and by how much will your dearness allowance increase?
Dearness Allowance (DA) is given to employees and pensioners to provide relief from rising inflation. It is determined based on AICPI (All India Consumer Price Index) data.
The math behind the data: The AICPI index data from January to June 2025 clearly indicates that a 3% increase in dearness allowance is certain this time.
55% to 58%: Currently, central government employees receive dearness allowance at the rate of 55%. After this 3% increase, it will increase to 58%.
The complete math behind DA: How was the 3% increase determined?
Dearness allowance depends on the AICPI index data. Let's see how the journey from January to June 2025 unfolded:
Month CPI(IW)BY2001=100 DA% Monthly Increase
Jan 2025 143.2 56.39
Feb 2025 142.8 56.72
Mar 2025 143.0 57.09
Apr 2025 143.5 57.47
May 2025 144.0 57.85
Jun 2025 145.0 58.18
As you can see, the total DA figure reached 58.18% at the end of June 2025. As per the rules, DA is not given in decimals, so it is considered fixed at 58%.
Salary Calculation: Understand how much money you will get in your pocket.
Now let's get to the biggest question. How much will a 3% DA increase affect your salary? Let's understand this with a simple table.
(Benefits based on different basic salaries)
Employee Level Current Basic Salary Current DA (55%) New DA (58%) Monthly Benefit Annual Benefit
Level-1 (Minimum) ₹18,000 ₹9,900 ₹10,440 ₹540 ₹6,480
Level-3 ₹21,700 ₹11,935 ₹12,586 ₹651 ₹7,812
Level-6 ₹35,400 ₹19,470 ₹20,532 ₹1,062 ₹12,744
Level-7 ₹44,900 ₹24,695 ₹26,042 ₹1,347 ₹16,164
Maximum (Cabinet Secretary) ₹2,50,000 ₹1,37,500 ₹1,45,000 ₹7,500 ₹90,000
This table clearly shows that employees at every level will receive a significant salary increase.
Three months' arrears will also be available.
Although the government will make this announcement on October 15th, this increased dearness allowance will be considered effective from July 1, 2025. This means that you will receive the arrears for the three months of July, August, and September together.
Example: If your salary is increasing by ₹1,347 every month, you will receive arrears of ₹1,347 x 3 = ₹4,041 with your October salary. This will be a great bonus for Diwali expenses.
The 8th Pay Commission's Appearances Intensify
This increase in DA not only increases your salary, but also intensifies the arrival of the 8th Pay Commission. According to the rules, when DA crosses 50%, it is merged with the basic salary, initiating the process of establishing a new Pay Commission. DA will now reach 58%, which almost certainly increases the pressure on the government to form the 8th Pay Commission, which is scheduled to be implemented from January 1, 2026.
Conclusion
This announcement on October 15th will be the biggest and most anticipated Diwali gift for central employees. The 3% DA increase will not only provide them immediate relief from rising inflation, but will also double their festive season joy with three months' arrears. This decision is sure to bring smiles to millions of faces, and all eyes are now on the Cabinet meeting on October 15th.
Disclaimer: This content has been sourced and edited from Zee Business. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
