8th Pay Commission: Exciting news for central government employees! The Labor Bureau has announced the All India Consumer Price Index-Industrial Workers (AICPI-IW) figure of 148.2 for December 2025. As a result, a 2% increase in dearness allowance (DA) is highly likely starting January 2026. If this occurs, the current rate of 58% will rise to 60%. Millions of central government employees and pensioners are eagerly awaiting the official announcement.
Announcement likely before Holi
The main question is whether the government will make this announcement before Holi? This year, Holi is celebrated on March 3, 2026. Typically, the government raises DA twice a year (in January and July), but announcements are often made in March and September/October. Occasionally, announcements are made prior to significant festivals like Holi or Diwali, allowing employees to receive benefits before the celebrations. However, this is not always feasible.
For instance, in 2025, Holi was on March 14th, but the DA increase was revealed on March 28th. The second increase for that year was announced on October 1st, 2025, while Diwali was on October 20th. This indicates that an announcement before the festival is possible, but there is no guaranteed date. Manjeet Singh Patel, the national president of the All India NPS Employees Federation, believes the government might announce it before Holi, although a formal order could be issued in April.
Understanding with an example
To illustrate why DA is crucial, consider this example. Under the 7th Pay Commission, the basic salary for an entry-level Group D employee is Rs 18,000, effective January 1, 2016. The 7th Pay Commission concluded on December 31, 2025, and the 8th Pay Commission may take some time to be put into effect. Therefore, employees’ basic salaries will remain unchanged for now, but DA will increase every six months, enhancing their overall salary.
If 58% DA is paid on a basic salary of Rs 18,000, the DA amount is Rs 10,440, resulting in a total salary of Rs 28,440. If the DA is increased to 60%, it will be Rs 10,800, making the basic salary and DA total Rs 28,800. Additionally, house rent allowance (HRA) and a 3% annual increment are also paid separately. Senior employees also receive several other allowances, which significantly impact their total salary.
What is calculation?
DA is determined using the average AICPI-IW over the past 12 months. As of December 2025, this average stands at 145.54. To connect the base year figure from 2016 to that of 2001, a factor of 2.88 is utilized. Following the prescribed formula, the DA is calculated to be around 60.33%. Typically, the government announces figures in rounded numbers, leading to the assumption that this will be 60%. Consequently, it is highly likely that DA will rise from 58% to 60% starting January 2026—everyone is now eagerly awaiting the official government announcement.
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