DA Hike : In a recent and welcome development for government employees, the central government has announced a significant increase in the Dearness Allowance (DA), aimed particularly at those still receiving their salaries or pensions under the 5th and 6th Central Pay Commission frameworks. Amid rising inflation, this DA hike is a crucial step toward ensuring that the purchasing power of employees remains intact.
DA Hike : DA Hike Approved to Offset Inflation
Inflation continues to impact daily expenses and essential commodities, placing financial pressure on salaried individuals, especially government employees. To cushion the impact of inflation and support employees financially, the government revises the DA twice a year. Dearness Allowance is a cost of living adjustment allowance paid to government employees, public sector employees, and pensioners.
Now, as per the latest announcement, the government has decided to increase DA by 8% for certain categories of employees. This move comes just after the central government revised the DA for employees under the 7th Pay Commission. While the 7th Pay Commission beneficiaries received their DA updates recently, now it’s time for those under the 5th and 6th Pay Commissions to benefit from an increase as well.
DA Hike : Who Will Benefit from the DA Hike?
The newly announced DA hike will benefit employees and pensioners who are still under the 5th and 6th Pay Commission salary structures. Many such employees continue to receive their salaries based on older pay commission guidelines due to their association with specific organizations, such as Central Autonomous Bodies and Central Public Sector Enterprises (CPSEs). These institutions have not yet fully implemented the 7th Pay Commission’s salary structures.
Employees in these bodies, therefore, are still governed by the older pay matrix and benefit rules. As a result, whenever a revision happens under their respective pay commission framework, it directly affects their in-hand salary and pensions.
DA Hike : 5th Pay Commission: DA Increased from 466% to 474%
As per the official Office Memorandum (OM) issued by the Ministry of Finance, government employees who continue to draw their salaries under the pre-revised pay scales of the 5th Central Pay Commission will now receive DA at the rate of 474% of their basic salary, up from the earlier rate of 466%.
This revision will come into effect from July 1, 2025, and will be reflected in the subsequent salary disbursements and pension calculations for eligible employees.
It’s important to note that while the 5th Pay Commission’s tenure officially ended in December 2005, a number of employees and pensioners, particularly in certain government bodies, still follow the structure due to delays or policy decisions regarding the adoption of newer pay commissions.
DA Hike : 6th Pay Commission: DA Hiked from 252% to 257%
In a similar move, employees and pensioners who are still drawing their salaries or pensions as per the 6th Central Pay Commission will also receive a DA hike. According to the Finance Ministry, the DA under the 6th CPC has been increased from 252% to 257% of the basic salary.
Just like the revision under the 5th CPC, this hike will also be effective from July 1, 2025. The revision reflects the government’s effort to balance out the financial impact of inflation on these employees, who often belong to specific sectors or autonomous bodies where the 7th CPC is yet to be implemented.
DA Hike : Why Some Employees Still Follow 5th or 6th Pay Commission?
Though the 7th Pay Commission was implemented in January 2016, and its benefits have been extended to a large section of central government employees, there remains a considerable number of employees who are still governed by the 5th or 6th CPC. These primarily include employees of Central Autonomous Bodies, educational institutions, and CPSEs, where the implementation of the 7th CPC has either been delayed or selectively applied.
Due to organizational structures, funding models, or internal policy decisions, these bodies continue to function under the older salary and allowance systems. This is why the government continues to revise DA rates under multiple pay commission frameworks.
Significance of DA Hike
The Dearness Allowance is one of the most critical components of a government employee’s salary. Its primary objective is to offset the impact of inflation and cost-of-living changes. An 8% increase, although based on older pay scales, still offers a substantial relief to employees and pensioners who are struggling to keep up with rising prices of essential goods and services.
With inflation eating into fixed incomes, especially for pensioners who do not have any other source of income, a timely DA hike can make a noticeable difference in financial stability. By revising the DA regularly, the government ensures that the real income of its employees does not diminish over time due to inflation.
Previous and Upcoming Trends in DA Hikes
Traditionally, DA is reviewed twice a year, in January and July, based on the Consumer Price Index (CPI) for Industrial Workers. The 8% hike for 5th and 6th CPC beneficiaries aligns with the recent trend of consistent increases in DA rates across pay commissions.
This year, the 7th Pay Commission employees had already received their DA hike, and now with this announcement, all segments—under the 5th, 6th, and 7th CPCs—are being covered. The government is expected to continue this practice in the future, depending on inflation trends.
Final Thoughts
This DA hike is a welcome move for thousands of central government employees and pensioners who have been eagerly waiting for such a revision. While the benefits under the 7th Pay Commission often receive more attention, this hike acknowledges the needs and financial concerns of those who are still governed by older pay structures.
With inflation continuing to be a challenge, such timely revisions not only improve the financial well-being of employees and pensioners but also reflect the government’s commitment to fair wage practices across all pay commission categories.
