DA hike: The time has come for government employees and retired pensioners working under the central government to receive a salary and pension increase, as a 2% increase in DA and DR is almost certain.

DA hike: There's good news for central government employees and pensioners. A 2% increase in Dearness Allowance (DA) and Dearness Relief (DR) is almost certain from January 2026. This is expected to provide relief from rising inflation. This means that the time has come for government employees and retired pensioners working under the central government to receive a salary and pension increase. Currently, employees receive a dearness allowance at the rate of 58%, and with the upcoming 2% increase, it will reach 60%.

On what basis is DA determined?

According to a Moneycontrol report, the reports of a 2% increase in DA and DR are not mere speculation, but are based on solid government data from the Labour Bureau. The All India Consumer Price Index (AICPI-IW), used for DA calculations, increased by 0.5 points to 148.2 in November 2025.

As per the 7th Pay Commission rules, the Consumer Price Index (CPI-IW) for the previous 12 months is considered for determining DA, which is based on daily expenses on food, transportation, housing, and healthcare.

What do experts say?

If we look at the data from July to November 2025, the graph has been steadily moving upwards. Based on November data, dearness allowance appears to have reached 59.93 percent, which clearly shows that dearness allowance is very close to 60 percent and there is no possibility of it falling below it.

Now all eyes are on the December 2025 index, which is yet to be released. But according to experts, the picture is unlikely to change. The math is simple: even if the index remains stable in December, the average DA will be 60.34 per cent. Even if the index declines slightly, it will remain at 60 per cent.

When will the announcement be made?

The government's policy has always been to announce dearness allowance in whole numbers, not decimals. Therefore, any figure between 60.00 percent and 60.99 percent will ultimately be considered 60 percent. This means that the current dearness allowance is almost certain to increase by 2 percent from 58 percent to 60 percent.

Although these increased rates will be effective from January 1, 2026, due to government procedures, the official announcement and notification usually come in March or April. Employees will receive the difference between January and the announcement as arrears. This increase is also significant because the new cycle of the 8th Pay Commission is expected to begin on January 1, 2026.