The staff’s bat-bat! 5% jump expected in DA amid 8th Pay Commission, transport allowance will also increase

Central Employees DA Hike: Central government employees are eagerly waiting for the release of the All-India Consumer Price Index (AICPI-IW) for December 2025 so that they can estimate the possible increase in Dearness Allowance (DA). Dearness Allowance (DA) for central government employees and pensioners is revised twice a year, and the next revision is due in January 2026. Earlier in July 2025, DA was increased from 55% to 58%.

As DA increases, transport allowance also increases. If there is an increase of 5% in DA after the release of AICPI-IW data for December 2025, then 50.14 lakh central employees and about 69 lakh pensioners will see an increase in transport allowance.

DA increase affects only TA

It is worth noting that the DA increase affects only the transport allowance. Other allowances like House Rent Allowance (HRA) change only when the basic salary is revised. Basic pay is usually increased through the Pay Commission’s fitment factor, and the next basic pay revision is likely to take place in July 2028, when the 8th CPC submits its report.

DA expected to increase by 5% to 63%

If AICPI-IW data for December 2025 remains stable at 148.2, DA is expected to increase by 5% to 63%. Its calculation is as follows: Multiplying the average AICPI-IW for the last 12 months by 2.88 comes to 426.81. By subtracting 261.41 from this, 165.4 is left, which when divided by 261.41 gives 0.63. Multiplying this by 100 gives 63% DA. Since the existing DA is 58%, the total increase in DA will be 5%.

How is transport allowance decided?

According to the 7th Pay Commission, central employees Transport Allowance (TA) is linked to their pay level and category of city of posting. At present cities are divided into three categories – X, Y and Z. Among these, TA is given highest in X category cities, whereas it is kept low in Y and Z category cities.

Transport Allowance (TA) is given as a fixed amount every month, and Dearness Allowance (DA) is also added to it. Additionally, employees at level 14 and above, who are entitled to an office car but do not use it, receive ₹15,750 a month. At the same time, a physically handicapped employee has the right to get double the applicable TA amount.

DA of current employees

Since the implementation of the Seventh CPC, DA has continuously increased to 58%. On this basis, the total TA of an employee with TA of ₹ 1,800 has now become ₹ 2,844. If DA increases by 5% to 63%, the DA share at a TA of ₹1,800 will be ₹1,134 and the total TA will be ₹2,934.

Also read: Budget 2026: 6 big ‘gifts’ for central employees, from salary to pension, there may be changes in the budget

Data will come in the first week of February

The Ministry of Labor and Employment may release the AICPI-IW data for December 2025 in the first week of February. Before the release of the data, it is being claimed in the media reports that this time there is a possibility of an increase of 5 percent in the dearness allowance as per the estimates of experts. However, nothing has been said officially yet.