Good News: Central government employees 2% DA hike News from 1 Jan 2025, arrears details
In a move aimed at cushioning the impact of inflation, the Union Cabinet has approved a 2% hike in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners. This increase, effective retrospectively from January 1, 2025, raises the DA from 53% to 55% of the basic pay or pension2.
The decision is set to benefit approximately 48.66 lakh employees and 66.55 lakh pensioners across the country. For instance, an employee with a basic salary of ₹18,000 will see an additional ₹360 per month, translating to ₹4,320 annually. Similarly, pensioners with a basic pension of ₹9,000 will receive ₹180 more per month3.
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The hike comes as part of the government’s biannual review of DA, which is calculated based on the Consumer Price Index (CPI) to offset the rising cost of living. This adjustment also includes arrears for the months of January, February, and March 2025, providing a timely financial boost for employees and pensioners.
While the increase is welcomed, it marks the lowest hike in recent years, with previous adjustments often ranging between 3% and 4%. Nevertheless, this revision is expected to provide some relief ahead of the anticipated 8th Pay Commission, which is set to come into effect from January 1, 20263.
Stay tuned for further updates on how this decision impacts central government employees and pensioners in the coming months!