DA reparations have been one of the most controversial issues among central government employees and pensioners. The government has updated the DA hike and the long-delayed payment of the DA at the beginning of October 2025. This is a significant update for the entire population of about 48 lakh employees and 66 lakh pensioners in India.
What Are DA Arrears?
DA arrears are payments of Dearness Allowance that remain unmade and that were frozen during the COVID-19 pandemic. To the extent of three DA installments, the period from January 2020 to June 2021 saw the government withholding payments in order to ease its financial burden. Years of protest have been the result of employees and unions fighting for the release of these arrears.
Government’s Stand in October 2025
The Ministry of Finance, in the context of a parliamentary reply, stated that the release of the 18-month arrears would not happen due to the government’s financial constraints, yet the government also mentioned that the regular DA hikes have already been restored in July 2021 and are being paid regularly.
Meanwhile, the Cabinet has hiked the DA by 3% making it 58% of the basic pay and pension, instead of the previous 55%, from 1 July 2025. The payment of the arrears for the months of July, August, and September will coincide with the October salary and pension, just before Diwali.
DA Arrears and Hike at a Glance
| Period / Update | Details |
|---|---|
| Frozen DA Period | Jan 2020 – Jun 2021 (18 months) |
| Govt Decision on Arrears | No payment of frozen arrears due to financial burden |
| Current DA Rate (Oct 2025) | Increased from 55% to 58% |
| Effective Date | July 1, 2025 |
| Payment Timeline | October 2025 salary/pension with arrears for July–Sept 2025 |
| Beneficiaries | 48 lakh employees, 66 lakh pensioners |
Impact on Salary and Pension
The hike in DA by 3% will be a significant addition to the monthly income of the employees and the pensioners. For instance, the monthly salary of an employee with a basic pay of ₹30,000 will be increased by around ₹900, which is ₹10,800 in a year. The increase in the Dearness Relief (DR) will be on the same scale for pensioners.
Final Thoughts
DA Arrears Latest Update October 2025 brings both good and bad news. On the one hand, the government continues not to pay the long-overdue 18-month arrears, while on the other hand, the 3% DA increase and the arrears for July-September 2025 give a small relief just in time for the festive season. Employees and pensioners might want to hold off on any big purchasing plans and save some money instead, considering that the release of the 8th Pay Commission in January 2026 might lead to changes in salary and pension structures.