DA Hike: The 7th Pay Commission is set to wrap up in December 2025. Still, there’s a chance for the DA and DR of government employees to see an increase under this Pay Commission. The government typically raises the dearness allowance once a year. Right now, the DA stands at 58% of the basic pay. A report from Financial Express suggests that the likelihood of a significant DA increase this time around is quite slim.
As per the report, central government employees and pensioners might have to settle for a modest salary bump in the upcoming year. The adjustment in dearness allowance (DA) and dearness relief (DR) for current employees and pensioners starting January 1, 2026, is expected to be just 2 percentage points, nudging the DA from 58% to about 60%.
DA Hike: Could this be the smallest increase in 7 years? If the Modi government decides to raise the DA by 2%, it will go from 58% to 60%. If that happens, it would mark the lowest DA increase in over seven years, mirroring the 2% hike we saw in January 2025.
This DA revision in January 2026 isn’t just a standard increase; it will take place outside the 7th Pay Commission cycle. The 10-year term of the 7th Pay Commission concludes on December 31, 2025. The DA adjustment from January 2026 will be the first one after the commission’s term ends. Although the 8th Pay Commission has been established, its Terms of Reference (ToR) don’t provide a specific date for implementation. The commission has 18 months to deliver its report, and it typically takes an additional two years to analyze, approve, and roll out new pay scales.
Once the 8th Pay Commission is finally put into action, the DA at that point is generally incorporated into the basic pay, and the DA resets to zero. This means that the next four DA hikes (January 2026, July 2026, January 2027, July 2027) will play a crucial role in determining how much your revised basic pay will be in the new pay matrix.