The government is ready to give a big festive gift to central government employees and pensioners. More than 1.2 crore people will benefit. A 3 percent hike in Dearness Allowance (DA) and Dearness Relief (DR) is likely to be announced in the first week of October 2025, just before Diwali.
DA Will Rise to 58 Percent With Arrears
With this hike, DA will go up from 55 percent to 58 percent. The new rate will be effective from July 2025. Employees will also get arrears for July, August, and September, which will be paid along with the October salary.
Pattern of DA Announcements
The government usually gives DA hikes twice every year. One comes in March before Holi for the January–June period. The second comes in October before Diwali for the July–December period. Last year, the DA hike was announced on October 16, 2024. This year, Diwali falls on October 20–21, so the announcement is expected around the same time.
How DA Is Calculated
DA is fixed using the Consumer Price Index for Industrial Workers (CPI-IW). The index shows the rise in cost of living. For this hike, the average CPI-IW from July 2024 to June 2025 came to 143.6. Based on this number, the DA is set at 58 percent.
Salary and Pension Examples
Here is a simple table that shows how much extra money employees and pensioners will get after the hike:
| Basic Amount | Old DA @55% | New DA @58% | Monthly Increase |
| Salary Rs 18,000 | Rs 9,900 | Rs 10,440 | Rs 540 |
| Pension Rs 20,000 | Rs 11,000 | Rs 11,600 | Rs 600 |
So, an employee with Rs 18,000 basic pay will get Rs 540 more every month. A pensioner with Rs 20,000 basic pension will get Rs 600 more.
Why This Hike Is Important
This hike is special because it is the last DA increase under the 7th Pay Commission. The term of the 7th CPC ends on December 31, 2025. After this, the 8th Pay Commission will take charge and bring new salary rules.
8th Pay Commission Coming Soon
The 8th Pay Commission was announced in January 2025. Usually, a pay commission takes about two years to prepare and submit its report. So, the new salary structure is expected to be ready by end of 2027 or early 2028.
Some estimates say salaries may rise by 30 to 34 percent. But some experts think the real increase will be closer to 13 percent, since DA will reset in the new system.
Disclaimer: The information provided in this article is based on government updates, media reports, and general estimates about the expected DA hike. Final details will be confirmed only after the official announcement by the Centre. Readers are advised to rely on official notifications from the Ministry of Finance or related government departments for accurate figures. This article is for general informational purposes only and should not be considered as financial or legal advice.