Central government employees and pensioners may get a big Holi gift this year. The Centre is likely to announce an increase in Dearness Allowance (DA) and Dearness Relief (DR) this week, just ahead of March 14 festival.
If approved, this move will benefit 1.2 crore central government employees and pensioners.
Every year, the government revises DA and DR twice — in January and July — and this announcement, if made, will continue that trend.
If the government goes ahead with the hike, the revised DA and DR rates will be applicable from January 2025. It has been a consistent practice for the government to increase allowances around Holi to provide festive relief to employees.
The second annual revision, which applies from July, is typically announced around Diwali in October or November.
However, during the cabinet meeting held on March 5, 2025, in New Delhi, there was no discussion on DA hike. The last DA increase was in July 2024, when it was raised from 50% to 53%.
Before that, on March 7, 2024, the cabinet had approved a DA increase from 46% to 50%, which was officially announced on March 25, 2024, just days before Holi.
The government had also raised DA and DR by 3% on October 16, 2024, under the 7th Pay Commission, taking both to 53%, effective from July 1, 2024. Now, all eyes are on the next hike.
Additionally, in January 2025, the government announced plans for the 8th Pay Commission, expected to be implemented by next year. Since then, employees and pensioners have been hopeful for a substantial revision in salaries and pensions.
Reports also suggest that once the 8th Pay Commission is in place, existing allowances may be scrapped and new ones introduced, potentially giving employees significant financial gains.
As per the AICPI-IW data for December 2024, a 2% hike in DA is expected this time. However, the final decision will rest with the Union Cabinet led by the Prime Minister.