8th Pay Commission : How much will the DA increase under the 8th Pay Commission? Know here

8th Pay Commission : Millions of central government employees and pensioners are awaiting the announcement of the Dearness Allowance (DA) and Dearness Relief (DR) increase for January 2026. Typically, the government announces DA increases around major festivals like Holi, but this time, even after Holi, an official announcement has not yet been made. This has led to questions among employees and pensioners about when the DA increase will be announced.

DA is revised twice

The government revises dearness allowance twice a year. The first revision takes effect in January and the second in July. Currently, central government employees receive a dearness allowance at the rate of 58%. Based on recent inflation data, it is estimated that the DA may increase by approximately 2% from January 2026. If this happens, the DA for employees will increase from 58% to approximately 60%.

Dearness allowance is also important for government employees because it helps mitigate the impact of rising inflation. While employees’ basic salaries remain the same over time, when inflation rises, the government provides some income relief through DA. Similarly, pensioners are also given dearness allowance (DR) to mitigate the impact of inflation on their pensions.

Special formula for determining dearness allowance

A specific formula is used to determine dearness allowance. It takes the average of the Consumer Price Index for Industrial Workers (AICPI-IW) over the past 12 months as the basis. According to this formula, a fixed base value is subtracted from the 12-month average index, divided by that base value, and then multiplied by 100 to arrive at the DA percentage.

Know the detail

A conversion factor of 2.88 is also applied to link the new 2016 base year index with the old 2001 base. The Labor Bureau releases AICPI-IW data every month, and DA changes are determined based on the 12-month average of these data. Therefore, employees regularly monitor these data.

If we look at the 12-month average AICPI-IW data from January 2025 to December 2025, it was around 145.54. This translates to approximately 60.33% DA, which can be rounded to 60%. This means that the estimate suggests a 2% increase this time. However, the final decision will only be clear after the government’s official announcement, which millions of employees and pensioners are currently awaiting.