Dearness Allowance 2025 Hiked to 58% for Central Government Employees

The Ministry of Finance has announced a 3% increase in Dearness Allowance (DA) for Central Government employees, effective 01 July 2025. The revised DA 2025 rate of 58% benefits government employees, pensioners, and defence personnel, helping combat rising inflation and living costs. Stay updated with the latest DA rates, salary revisions, and pension updates for 2025

No.1/4(i)/2025-E.II(B)
Government of India
Ministry of Finance
Department of Expenditure

Kartavya Bhavan 1, Kartavya Path,
New Delhi-110001
Dated the 06 th October, 2025

OFFICE MEMORANDUM

Subject: Revision of rates of Dearness Allowance to Central Government employees effective from 01.07.2025.

The undersigned is directed to refer to this Department’s Office Memorandum No. 1/1(1)/2025-E.II(B) dated 2nd April, 2025 on the subject mentioned above and to say that the President is pleased to decide that the rates of Dearness Allowance payable to Central Government employees, shall be enhanced from 55% to 58% of the Basic Pay with effect from 1st July, 2025.

2. The term Basic Pay in the revised pay structure means the pay drawn in the prescribed Level in the Pay Matrix as per 7th CPC recommendations accepted by the Government, but does not include any other type of pay like special pay, etc.

3. The Dearness Allowance will continue to be a distinct element of remuneration and will not be treated as pay within the ambit of FR 9(21).

4. The payment on account of Dearness Allowance involving fractions of 50 paise and above may be rounded off to the next higher rupee and the fractions of less than 50 paise may be ignored.

5. These orders shall also apply to the civilian employees paid from the Defence Services Estimates and the expenditure will be chargeable to the relevant head of the Defence Services Estimates. In respect of Armed Forces personnel and Railway employees, separate orders will be issued by the Ministry of Defence and the Ministry of Railways, respectively.

6. In so far as the persons serving in the Indian Audit and Accounts Department are concerned, these orders are issued in consultation with the Comptroller and Auditor General of India, as mandated under clause (5) of Article 148 of the Constitution of India.

Hindi version is attached.

(Samir Kumar Das)
Deputy Secretary to the Government of India

Download Central Government Employees July 2025 DA order

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Revision of rates of Dearness Allowance to Central Government employees effective from 01.01.2025 – 53% to 55% of the Basic Pay with effect from 1st January, 2025.

No. 1/1(1)/2025-E.II(B)
Government of India
Ministry of Finance
Department of Expenditure

OFFICE MEMORANDUM

North Block, New Delhi
Dated the 2nd April, 2025

Subject: Revision of rates of Dearness Allowance to Central Government employees – effective from 01.01.2025.

The undersigned is directed to refer to this Department’s Office Memorandum No. 1/5/2024- E.II(B) dated 21st October, 2024 on the subject mentioned above and to say that the President is pleased to decide that the rates of Dearness Allowance payable to Central Government employees, shall be enhanced from 53% to 55% of the Basic Pay with effect from 1st January, 2025.

2. The term Basic Pay in the revised pay structure means the pay drawn in the prescribed Level in the Pay Matrix as per 7th CPC recommendations accepted by the Government, but does not include any other type of pay like special pay, etc.
3. The Dearness Allowance will continue to be a distinct element of remuneration and will not be treated as pay within the ambit of FR 9(21).
4. The payment on account of Dearness Allowance involving fractions of 50 paise and above may be rounded off to the next higher rupee and the fractions of less than 50 paise may be ignored.
5. The payment of arrears of Dearness Allowance shall not be made before the date of disbursement of salary of March, 2025.
6. These orders shall also apply to the civilian employees paid from the Defence Services Estimates and the expenditure will be chargeable to the relevant head of the Defence Services Estimates. In respect of Armed Forces personnel and Railway employees, separate orders will be issued by the Ministry of Defence and Ministry of Railways, respectively.
7. In so far as the persons serving in the Indian Audit and Accounts Department are concerned, these orders are issued in consultation with the Comptroller and Auditor General of India, as mandated under clause (5) of Article 148 of the Constitution of India.

Hindi version is attached.

(Samir Kumar Das)
Deputy Secretary to the Government of India

To
All Ministries/ Departments of the Government of India (as per standard distribution list)

Download Fin Min DA Order Jan 2025

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CONFEDERATION OF CENTRAL GOVT. EMPLOYEES & WORKERS
1st Floor, North Avenue PO Building, New Delhi – 110001

Ref: Confed./2025/Improvement in DA & DR/

Dated – 17.01.2025

To,
The Cabinet Secretary,
Government of India,
Rashtrapati Bhawan,
New Delhi -110004
Email address : cabinet[at]nic.in

Sub: Request for the improvement in computation of Dearness Allowance & Dearness Relief for Central Government Employees and Pensioners- reg.

Respected Sir,

The Confederation of Central Government Employees and Workers, represents about 7 lakhs Central Government employees, working in various Departments of Central Government Departments viz., Postal, Income tax, AG’S, Audit Departments, Survey Departments, Census, GSI, CPWD, CGHS, SREE CHITHRA etc. numbering about 130 Associations & Federations are affiliates of Confederation of Central Government employees and Workers.

The Confederation extends its warm festive Greetings and new year wishes.

The main improvements suggested in computation of Dearness Allowance & Dearness Relief of Central Government employees & pensioners sought are as below; –

1) The DA formula is as below:

For Central Government Employees:
DA = { (Average of AICPI (Base year 2016=100) for the last 12 months – 115.76)/115.76 } x 100

For Public Sector Employee:
DA = { (Average of AICPI (Base year 2001=100) for the last 3 months – 126.33)/126.33 } x 100

The above formula needs modifications.

The formula to calculate the Dearness Allowance (DA) for bank employees is:

• DA% = [(Average of AICPI (Base Year 2001 = 100) for the last 3 months – 126.33)/126.33] x 100

2) The average of 12 months should be replaced by a three months average that means variable DA should be given so that the employees get compensated by actual price rise every three months.as in public sector employees and Banks employees.

The DA of banking employees are revised every quarter i.e. Feb-April, May-July, August- October and November- Jan every year

If a price rise is taking place in January, it is compensated partially after 12 months. The DA should be calculated and paid every three months instead of six months

3) Point to point DA should be provided, now the DA is rounded off to lowest value if we are eligible for 42.90 % DA we are sanctioned only 42% DA, the 0.9 % DA is being deprived to the CG employees for six months, the point-to-point DA should be provided to us as in the case of Banks and LIC employees get the DA even point to point DA.

4) Construct a separate consumer index for the Central Government Employees and Pensioners.

The items used for calculation of the Consumer price index is 465 items after the new series 2016 was adopted by the Government. As many of these items are not used by the central government employees in day-to-day life, it neutralizes the effect of price rise of the actual items used by the central government employees and pensioners, we are getting less dearness allowance than the actual price rise happening. Hence there is a need to construct a separate consumer index for the central government employees and pensioners.

Recommendation of 6th CPC vide para no 4.1.13

The Commission is of the view that the National Statistical Commission may be asked to explore the possibility of a specific survey covering Government employees exclusively, so as to construct a consumption basket representative of Government employees and formulate a separate index. Meanwhile, the Government may continue to use the AICPI (IW) for estimating the DA.

Hence separate DA / AICPI should be formed for Government employees

5) The Labour Bureau, which is an attached office of the M/O Labour & Employment, has been compiling Consumer Price Index for Industrial workers every month on the basis of retail prices collected from 317 markets spread over 88 industrial important centres in the country. The index is compiled for 88 industrial important centres and All India Consumer Price Index is released on the last working day of succeeding month by Ministry Of Labour & Employment, Labour Bureau Chandigarh on last day of the month on which the DA is calculated every six months.

The Consumer Price Index for Industrial Workers maintained by Labour Bureau, Shimla and the retail prices are showing different retail rates, the retail prices of essential commodities are at higher end including that of state Government run co-operative societies compared to the retail prices maintained by Labour Bureau, Shimla, not on prevailing market retail rates, net difference of price of commodities varies up to 30 %.

The retail prices are higher in other Central Government Departments, compared to the Labour Bureau, Shimla such as Directorate of Economics & Statistics prices which is also a Central Government Department https://rpms.dacnet.nic.in/

&

Department Of Consumer Affairs (Price Monitoring Division) https://fcainfoweb.nic.in/

Therefore, the CG employees & pensioners are deprived of proper Consumer Price Index as retail prices maintained by Labour Bureau, Shimla are adopting lower prices.

The Dearness Allowance and Dearness relief is based upon the Consumer Price Index (CPI) points.

Hence proper methodology shall be adopted at arriving at the retail prices of the items, which leads to construction of the Consumer Price Index (CPI).

The above main improvements suggested in Dearness Allowance & Dearness Relief of Central Government employees & pensioners is requested to be implemented at the earliest.

With Regards,

Yours Sincerely,
(S.B. Yadav)
Secretary General

Copy to,
The Secretary General, Staff Side, NC JCM New Delhi.

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The Sources Close to the Ministry of finance informed that there is proposal to Pay 1% DA from July as an interim Measure.It is said that the Central Government has not yet decided about the DA rates in Revised Pay scale.

Sources close to Finance Ministry told that the initial installment of DA to central government employees on the revised pay structure w.e.f 1.7.2016 is under consideration. Mean time there is a proposal to pay the DA from July 2016 at the rate of 1% to all CG Staffs. It will be a shocking news for CG Staff, since they are already expecting 2 to 3% DA from July 2016.

PRU is asked to submit Financial Implication of 1% DA

But the fact is the Department of Expenditure has directed the PRU of the Finance Ministry to furnish the details of additional Financial Implications for 1% increase of DA with effect from 1.7.2016 on the revised Pay Structure.

Further the Pay Research Unit has been requested to furnish financial implications for the Period of July 2016 to February 2017 on account of granting 1% DA from July 2016 to all central government employees including Armed Forces and UT Employees.

According to the above information, it is believed that announcement of 1% DA for July installment may be made any time soon.

Source: http://govtstaffnews.in/

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BSNL Employees Union published a message about the merger of 50% Dearness allowance to Central Government Employees and Pensioners.

The Central Government has already formed the 7th Pay Commission for it’s employees. The Commission will recommend wage revision for the 50 lakh Central Government employees, as well as pension revision for the 30 lakh pensioners.

As per media reports, the Government may merge 50% DA with the basic pay, for which the unions are hard pressing the Government. As of now, the Central Government employees are getting 90% DA. They are going to get another 10% DA increase from next month, which will take their total DA to 100% of pay. The normal practice is that DA will be merged with pay, when it reaches 50%. Merger of 50% DA with basic pay was done by the 5th Pay Commission, while the 6th Pay Commission refused to do so. Now, as per media reports, the Government is likely to make a proposal in this regard to the terms of reference for the 7th Pay Commission.

In respect of the BSNL employees, the BSNLEU has already raised the demand that 50% IDA should be merged with the basic pay. The recently held Rajkot CEC meeting of BSNLEU has passed a resolution, strongly demanding 50% IDA merger.

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While answering to a question raised by our Hon’ble Member of Rajya Sabha Shri. Sardar Balwinder Singh Bhundar, the Minister of State in the Ministry of Finance (E and FS) Shri.NamoNarain Meena replied in a written form on 7th May, 2013 that the ‘5th Pay Commission had recommended that Dearness Allowance should be converted into Dearness Pay each time the Consumer Price Index increases by 50% over the base index used by the last pay Commission. Accordingly the Government issued orders on 27.02.2004 for merging of 50% of the DA with the basic pay w.e.f.01.04.2004.

The 6th Central Pay Commission had recommended not to merge Dearness Allowance with basic pay at any stage. Government has accepted this recommendation vide Resolution dated 29.08.2008. Hence the question to merge DA with basic pay does not arise. However, the rate of DA is being revised at periodic intervals’.

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