Important news has emerged for government employees. The increase in dearness allowance (DA), effective July 2026, has caught the attention of 5 million central government employees and over 6.5 million pensioners across the country. As the festive season approaches, it's expected that the government may announce the DA hike before Navratri or Diwali.

According to information received, the DA, which is effective from July, is usually announced in September or October. Therefore, this year, a decision on this could be made around Navratri or before Diwali. Importantly, even if the announcement is delayed, the increased DA will be considered effective from July 1, 2026, so employees are likely to receive their pending payments in arrears.

It has been reported that central government employees currently receive 60% DA on their basic salary. According to the AICPI-IW data for July 2026, DA is expected to reach 64% as the index has reached 153.2. This means an increase of 4% compared to the current rate.

However, a 4% increase in DA does not mean a direct 4% increase in the total in-hand salary. DA is calculated on the basic salary. Therefore, the actual salary increase will depend on the employee's basic salary. This increase is not limited to the salary of employees, but may also impact the monthly pension of pensioners. Factors such as PF and gratuity are also likely to be affected. Following Cabinet approval, an official announcement will be made by the government, and employees are expected to receive the increased amount and arrears during the festive season.

PC: Mint