3% DA hike approved for central govt employees, pensioners ahead of Dussehra, Diwali

The Union Cabinet on Wednesday approved a 3 per cent hike in Dearness Allowance (DA) for central government employees and pensioners. The hike in DA comes ahead of festivals such as Dussehra and Diwali.

With this, the rate went up from 55 per cent to 58 per cent of basic pay and pension. The hike will take effect retrospectively from July 1, 2025. Arrears for July, August, and September will be paid along with the October salary, just before Diwali.

The increase covers all Central government employees under the 7th Pay Commission, as well as pensioners and family pensioners. For instance, an employee with a basic salary of ₹30,000 will receive an additional ₹900 per month, while someone earning ₹40,000 will get ₹1,200 more. Over three months, the arrears will total ₹2,700 to ₹3,600—providing timely festive relief.

Dearness Allowance (DA) and Dearness Relief (DR) are revised twice a year, in January and July, based on inflation trends measured by the All India Consumer Price Index for Industrial Workers (CPI-IW). While announcements often come later, arrears compensate for the delay. This revision is expected to be the last under the 7th Pay Commission, with the 8th Pay Commission likely to take effect in January 2026.

The increase will benefit around 48 lakh employees and 68 lakh pensioners.