2025 is coming. Government employees and pensioners are eagerly waiting for the Dearness Allowance (DA) hike expected in January 2025. With inflation on the rise, this potential increase could bring some much-needed relief. However, the actual increase hinges on the All India Consumer Price Index (AICPI) data, which is why the official announcement has been delayed.
So, how is the Dearness Allowance calculated?
The DA is revised every six months based on AICPI data. The government looks at the data from January to June and July to December, then announces the DA adjustment based on the average AICPI over the past year. On October 16, 2024, the central government raised the DA by 3%, bringing it to 53%, benefiting over a crore employees and pensioners. Earlier, in January 2024, there was a 4% increase to 50%, which was announced in March.
What’s the expected DA increase for January 2025?
There’s a good chance the DA could go up by another 3% in January 2025. Given the current AICPI trends, which hit 144.5 in October 2024 and are likely to keep climbing, the DA might reach 56%. If this happens, it will directly affect the salaries and pensions of employees and pensioners.
For instance, employees earning a minimum salary of Rs 18,000 could see an increase of Rs 540, while those at the top end with a salary of Rs 2,50,000 might get an extra Rs 7,500. Pensioners will also benefit, with their pensions potentially rising from Rs 270 to Rs 3,750.
