To help pensioners cope with rising inflation, the government provides dearness relief (DR). DR is equal to the dearness allowance (DA) paid to government employees and is revised twice a year. Currently, DR is 58%. The term of the 7th Pay Commission officially ends on December 31, 2025, and the next DR increase is scheduled for January 2026.
Will DR continue to increase after the Pay Commission ends
Many pensioners are wondering whether their DR will continue to increase after the 7th Pay Commission ends, or will it become zero? The secretary of a major employees’ and pensioners’ association and a former central government employee says that pensioners’ DR continues to increase even after the Pay Commission ends.
He clarified that just as employees’ DA increases after the Pay Commission ends, so too does the DR of pensioners. Therefore, until the 8th Pay Commission recommendations are implemented, it will be increased twice a year. Previously, when the implementation of the Pay Commission recommendations was delayed, DR was increased along with DA.
When is the DR increase announced
The government increases DR twice a year, in January and July. However, in most cases, the government does not announce the increase during these two months. The government announces festivals like Holi and Diwali. In such cases, pensioners also receive arrears.
How does DR affect your pension
DR is calculated based on the pensioner’s basic pension. Let’s assume the basic pension is ₹25,000 and the current DR rate is 58%. So, the total pension of the pensioner will be ₹25,000 + (58% of ₹25,000) or ₹39,500. Now, if the government decides to increase the DR by 2% to 60% in January 2026, the total pension (for the same pensioner) will increase to ₹40,000.
Pension and the Potential Impact of the 8th Pay Commission
According to information provided by the Ministry of Finance to Parliament, the total number of pensioners in the central government is 6.9 million, which is more than the number of government employees (5.014 million). Under the 7th Pay Commission, pensions were revised based on a fitment factor of 2.57. Under this, the minimum pension is ₹9,000, and the maximum pension is ₹1,25,000. If the government decides to increase the pay through fitment factor under the 8th Pay Commission, and the fitment factor is 2.0, the minimum basic pension may increase to ₹18,000 and the maximum to ₹2,50,000.