The central government was anticipated to raise the dearness allowance (DA) and dearness relief (DR) before Holi, but that didn’t happen. Even during last week’s cabinet meeting, there was no announcement regarding the DA/DR increase. The Union Cabinet typically meets every Wednesday, and 1.2 crore central employees and pensioners are eagerly awaiting news about the DA/DR hike this week. The main goal of raising DA and DR is to help offset inflation.

 

DA/DR adjustments occur twice a year, with the first increase taking effect on January 1 and the second on July 1. It’s important to note that central government employees and pensioners receive their payments based on the 7th Pay Commission. There’s a possibility that the Union Cabinet will announce the DA/DR increase this week, with arrears covering the period from January to March.

 

Currently, the minimum basic salary for central government employees is Rs 18,000, while pensioners receive a minimum basic pension of Rs 9,000. Last October, the government raised the DA/DR by 3 percent, bringing it to 53 percent.

 

So, how much of an increase can we expect in DA? Many experts predict that the DA/DR could rise by anywhere from 2% to 4%.

 

What does this mean for employees? If someone’s current minimum basic salary is Rs 18,000 and the DA goes up by 2 percent in January 2025, their salary would increase by Rs 360. With the current DA at 53 percent, their total salary would be Rs 27,540 (minimum basic salary plus DA). However, if the DA rises to 55 percent, their salary would then be Rs 27,900.

 

If the DA rises by 3 percent, it will reach 56 percent. This means the minimum basic salary will go up by Rs 540, bringing it to Rs 28,080 each month.

 

If the DA increases by 4 percent, it will hit 57 percent, resulting in a minimum basic salary boost of Rs 720, making it Rs 28,260 per month.

 

So, what does this mean for pensioners? If someone’s current minimum basic pension is Rs 9,000 and the DR goes up by 2 percent in January 2025, their minimum pension will rise by Rs 180.

 

With the current 53 percent DR, they qualify for a pension of Rs 13,770 (minimum basic pay plus DR). However, if the DA increases to 55 percent, their pension will be Rs 13,950.

 

If the DR increases by 3 percent, it will become 56 percent, leading to a minimum basic pension increase of Rs 270, totaling Rs 14,040 per month. If the DR goes up by 4 percent, reaching 57 percent, the minimum basic pension will rise by Rs 360, bringing it to Rs 14,130 per month.