Lowest DA Hike in 7 Years
The upcoming DA hike for central government employees and retirees is expected to be just 2%, significantly lower than previous years’ increases of 3% or 4%. This marks the lowest hike since July 2018, reflecting the impact of the All India Consumer Price Index (AICPI) on DA calculations.
Recent DA Hike History
The government revises DA and Dearness Relief (DR) twice a year, in January and July. Here is a timeline of recent hikes:
- July 2024: DA increased from 50% to 53%.
- March 2024: DA raised from 46% to 50%.
- October 2024: DA and DR increased by 3%, reaching 53% under the 7th Pay Commission.
8th Pay Commission and Future DA Hikes
The government announced the 8th Pay Commission on January 16, 2025, with its recommendations set to take effect on January 1, 2026. Until then, one final DA hike under the 7th Pay Commission is expected around Diwali 2025. Once the new pay structure is implemented, the DA will be merged with the basic salary, resetting it to zero.
Impact on Government Employees
While the DA hike provides relief against inflation, employees may find the 2% increase underwhelming compared to past hikes. The 8th Pay Commission’s recommendations will be crucial in determining future salary adjustments, with its final report expected by March 2026.
