No 8th Pay Commission Yet, But DA Hike Possible: 10 Key Developments

Central Government Employees May Receive Relief from Dearness Allowance Hike

Lakhs of central government employees and pensioners continue to await the 8th Pay Commission's recommendations on salaries and pensions, but a smaller but more immediate relief could arrive sooner in the form of a Dearness Allowance (DA) hike. Recent inflation data has strengthened expectations that the government may announce another increase in DA from July 2026.

The All India Consumer Price Index for Industrial Workers (AICPI-IW), which is used to calculate DA, rose from 149.1 in March 2026 to 149.9 in April 2026. Meanwhile, retail inflation for industrial workers increased from 4.27 percent to 4.46 percent during the same period. DA is revised periodically to help employees and pensioners cope with rising living costs caused by inflation.

Central government employees and pensioners are currently receiving DA at the rate of 60 percent of basic pay. However, based on AICPI-IW data available up to April 2026, the 12-month average stands at 147.51. After applying the prescribed linking factor of 2.88 to convert the 2016 base series to the 2001 base series, the DA calculation works out to around 62.51 percent, which is likely to be rounded off to 63 percent. If this trend continues, employees could receive a 3 percent increase in DA.