Will Central Employees Receive Good News About Hike in Dearness Allowance before Holi
Dearness Allowance Hike: Central government employees and pensioners are now eyeing the Dearness Allowance (DA) hike for January-June 2026. It's expected that the government will announce it in the first week of March, before Holi.
As is the tradition every year, the January DA is usually announced in March, and the July DA is announced around Diwali in October-November. Meanwhile, the 7th Pay Commission completed its term on December 31, 2025, and all eyes are now on the 8th Pay Commission.
DA was 58% by Dec 31, 2025
Currently, the DA has reached 58% with latest 3% hike in December 31, 2025. It is estimated that a 2% increase could occur in January 2026, bringing the DA to 60%. If this happens, it would be one of the lowest January hikes in the last 26 years. However, it's not the lowest. January 2000 saw a mere 1% increase, while January 2007, 2018, and 2025 saw 2% increases. Even 1-2% matters to employees as it directly impacts monthly salaries, arrears, and pensions.
8th Pay Commission process is also progressing
Meanwhile, the 8th Pay Commission process is also progressing. The government released its Terms of Reference on November 3, 2025. The Commission's official website is live, and a detailed questionnaire is available on the MyGov portal, with a deadline of March 16, 2026. Only online suggestions are being accepted. The survey covers 18 key questions, including fitment factors, annual increments, pension structures, and allowance revisions. The Commission is required to submit its final recommendations within 18 months.
According to initial estimates, the fitment factor could be between 1.83 and 2.46, potentially leading to a 30–34% salary increase. DA will be zeroed upon implementation of the new pay structure, as has been the case with every new pay commission.
50 Lakh Central Employees to Benefit
Approximately 50 lakh central employees and 69 lakh pensioners will benefit from the commission's recommendations. Employee organizations are also drafting demands, and a drafting committee meeting is scheduled for February 25, 2026. All eyes are currently on the DA announcement in March. Even if the increase is only 2%, it will provide relief from inflation and may later be merged into the basic pay under the 8th Pay Commission.
Overall, 2026 could prove to be a year of change for employees, with the 7th Pay Commission era ending and the 8th Pay Commission beginning anew.