The Union Cabinet finally made an announcement in March of 2025 about the increase of 2% in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners. The announcement stated that the new rate would be effective from January 1, 2025, and would raise the rates from 53% to 55% of the basic salary or pension.
Payment of Arrears
By the retrospective effect of increasing the DA, it is entitled for the employees and pensioners to receive the arrears in the months of January, February, and March 2025. Disbursal of these amounts will be made along with the salary and pension payable for the month of April 2025.
- Employees: A person earning basic pay of ₹18,000 will get an increment of ₹360 on a monthly basis (i.e. 2% of ₹18,000) which will sum to ₹1,080 over three months.
- For Pensioners: A pensioner who receives a basic pension of ₹9,000 will have an additional ₹180 per month, amounting to ₹540 in total for the same period.
Future Revisions in DA
DA is generally revised twice in a year in the months of January and July every year. Next, the revision is possible in July 2025. However, the recent trend of the AICPI-IW figures shows a downward trend which will have its impact on future DA increases. Employees and pensioners must be aware of such changes as it matters in financial planning and budgeting.
Conclusion:
The recent 2% increase in DA and DR for all categories reflects the government’s will to support and continue improving the lives of its employees and pensioners during economic turmoil. Beneficiaries are advised to watch for official announcements on payments of these arrears and future DA changes to schedule their financial expectations.
