DA Hike: The central government has announced a 3 percent hike in DA (DR). The minimum wage is ₹18,000, and pension is ₹9,000. In-principle approval has been given for the constitution of the 8th Pay Commission.
According to the Seventh Pay Commission, the minimum basic pay for central government employees has been fixed at ₹18,000. This decision is playing a significant role in improving the living standards of lakhs of central government employees across the country. In addition, the minimum basic pension for retired employees has been fixed at ₹9,000. This will ensure a stable income for those who have completed their government service. Through this policy, the government is not only providing financial security to its employees but also supporting their families.
Recently, the Union Cabinet has taken an important decision for central government employees and pensioners. It has approved a 3 percent increase in Dearness Allowance (DA) and Dearness Relief (DR). As a result, the DA and DR rates are now 58 percent. This increase provides relief to employees at a time when the cost of living is increasing. Amidst the rising prices of essential commodities like food, fuel and education, this decision will be financially beneficial for many.
The central government had last announced a 2 percent hike in DA and DR in March 2025. Now, with another 3 percent hike, the total rate has reached 58 percent. This hike will be effective from January 1, 2025. This means that employees and pensioners will get their arrears from January to October together. Since it coincides with the festival of Diwali, it has brought extra joy to many families.
The central government increases DA/DR twice a year. The first increase will be effective from January 1 and the second from July 1. The increase is determined based on the expenses of the employees and inflation. With the increase approved this October, employees and pensioners will receive the pending payments in their accounts this month. This government decision will provide financial relief to many employees during the festive season.
Currently, as per the Seventh Pay Commission, the minimum basic pay of central government employees is ₹18,000. Now, with a 3 percent DA increase, an additional ₹540 will be provided. With this, the total pay including 58 percent DA will be ₹28,440. This is a significant benefit for low-paid employees as well. Similarly, the minimum basic pension for pensioners is ₹9,000, but with a 3 percent DA increase, it will increase by an additional ₹270. As a result, the total pension has increased by 58 percent to ₹14,220. This has enabled retired employees to meet their living expenses easily.
Calculation of salary and pension on last Diwali
Last Diwali, central government employees received salary with 53 percent DA and DR. At that time, the minimum salary was ₹18,000, and the total, including 53 percent DA, was ₹27,540. This year’s increase means that the minimum salary has increased by ₹900. Pensioners also received a pension of ₹13,770 last year at the rate of 53 percent DR. This year, their pension has increased to ₹14,220. This will provide some relief in their monthly expenses.
Latest developments on the 8th Pay Commission…
The Central Government has in-principle approved the constitution of the 8th Pay Commission in January 2025. However, the official notification has not been issued yet. The government has not yet decided who will be the members and chairperson of the new Pay Commission. According to the Central Government, discussions are underway with the state governments. The formation of this panel is expected to be announced soon. The formation of this commission will enable a comprehensive review of the salaries, allowances and other benefits of employees.
Method of calculating salary increment
Every pay commission uses a parameter called “fitment factor” while revising salaries. It is like a multiplier. The formula is: Revised salary = Basic salary × Fitment factor. The new salaries of the employees are determined on the basis of this fitment factor. For example, if the fitment factor is high, the salaries of the employees will increase more. If it is low, the salary increase will be limited.
