Cabinet Approves 2% Hike in DA for Government Employees

On March 28, 2025, the Union Cabinet, chaired by Prime Minister Narendra Modi, approved a 2% increase in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners. This hike, effective from January 1, 2025, raises the DA from 53% to 55% of Basic Pay/Pension, benefiting approximately 48.66 lakh employees and 66.55 lakh pensioners. The revision follows the established formula based on the 7th Central Pay Commission’s recommendations and aims to counter inflationary pressures.

Key Points

Increase in DA/DR

  • DA and DR increased by 2% from 53% to 55% of Basic Pay/Pension.
  • Effective date: January 1, 2025.

Beneficiaries

  • 48.66 lakh central government employees.
  • 66.55 lakh pensioners.

Financial Impact

  • Estimated burden on the exchequer: ₹6,614.04 crore per annum.

Background

  • DA is revised twice a year (January and July) based on the All India Consumer Price Index for Industrial Workers (AICPI-IW).
  • Last increase: July 2024, when DA rose from 50% to 53%.
  • The increase aligns with the 7th Central Pay Commission’s recommendations.

Purpose

  • DA is designed to offset inflation and maintain the real value of government employees’ salaries.
  • Anticipation of the 8th Pay Commission has increased interest in DA hikes.
Summary/Static Details
Why in the news? Cabinet Approves 2% Hike in DA for Government Employees
Approval Date March 28, 2025
Effective Date January 1, 2025
DA Increase 2% (from 53% to 55%)
Beneficiaries 48.66 lakh employees, 66.55 lakh pensioners
Financial Impact ₹6,614.04 crore per annum
Last Increase July 2024 (from 50% to 53%)
Basis for Revision 7th Central Pay Commission, AICPI-IW
Shivam

As a Content Executive Writer at Adda247, I am dedicated to helping students stay ahead in their competitive exam preparation by providing clear, engaging, and insightful coverage of both major and minor current affairs. With a keen focus on trends and developments that can be crucial for exams, researches and presents daily news in a way that equips aspirants with the knowledge and confidence they need to excel. Through well-crafted content, Its my duty to ensures that learners remain informed, prepared, and ready to tackle any current affairs-related questions in their exams.

Recent Posts

Bandi Chhor Divas 2026: Why Sikhs Celebrate the Festival on Diwali

Bandi Chhor Divas 2026 will be celebrated on Sunday, November 8, coinciding with Diwali. The…

3 hours ago

Countries That Celebrate Diwali Around the World: Complete List

One of the most popular festivals originating from India, Diwali, also known as Deepavali, has…

3 hours ago

Diwali GK Quiz 2026: Attempt Important MCQs with Answers and Explanations

Diwali, also known as Deepawali, is one of India's major festivals and is celebrated by…

3 hours ago

Which District of Uttar Pradesh is Known as the City of Diwali?

The holy city of Ayodhya in the state of Uttar Pradesh is a well-known "Diwali…

3 hours ago

Diwali Festival 2026: Religious Significance, Traditions and Celebrations

Diwali, also known as Deepawali, is one of India's most widely celebrated festivals. Known as…

3 hours ago

Deepavali 2026: Know Why the Festival of Lights Is a UNESCO Heritage Element

Deepavali, also known as Diwali, is one of the India's most widely celebrated festivals. Which…

3 hours ago