The central government has brought good news for over one crore employees and pensioners. The path has been cleared for an increase in dearness allowance (DA) in July 2026. The Ministry of Labor has released the inflation index (CPI-IW) data for June 2026. The dearness allowance will then be calculated in July. According to the latest data, central employees may receive a 3% dearness allowance. After that, the DA will increase from 60% to 63%. Employees are relieved because when everything has become expensive, the dearness allowance will increase.

Biggest hike before 8th Pay Commission

This is expected to be the largest increase in dearness allowance under the 7th Pay Commission in July 2026. The government has established the 8th Pay Commission, but the commission's recommendations have not yet been received. Until the recommendations are implemented, until the new Pay Commission is implemented, the new pay sheet will not be implemented, and dearness allowance will not be determined accordingly. Currently, employees will be paid dearness allowance under the 7th Pay Commission.

DA calculation in July

The Bureau of Labor, under the Ministry of Labor and Employment, has announced the Inflation Index for Industrial Workers (AICPI-IW) for June 2026. This figure has been recorded as 151.9. In May 2026, this index was 150.8. The June figure is higher. DA will now be increased on this basis. In March 2026, it was 149.1 and in April 2026, it was 149.9. The current 60% dearness allowance can be increased to 63%.

The DA hike will be effective from July 1, 2026. An official announcement will be made following a government notification and the Union Cabinet's approval. In previous years, the July DA was announced in September and October. The central government revises the dearness allowance twice a year, on January 1 and July 1. Currently, the dearness allowance is based on the recommendations of the 7th Pay Commission. The DA is calculated based on the 12-month average of the CPI-IW.

Will the fitment factor be 3.83?

The fitment factor determines the salary increase for central government employees. It is considered the most significant factor in the increase in basic salary. The fitment factor in the 7th Pay Commission was 2.57. According to experts, considering inflation and the economic situation, the fitment factor in the Pay Commission may be 2.15. Various employee organizations across the country have strongly demanded an increase in the fitment factor to 3.83.

PC: TV9