The long-debated issue of Dearness Allowance (DA) arrears has once again taken center stage among central government employees and pensioners. In November 2025, the Union Government issued a new update on both the pending arrears and the latest DA hike — a development that directly affects 48 lakh employees and 66 lakh pensioners across India.
What Are DA Arrears?
DA arrears refer to the pending Dearness Allowance payments that were frozen during the COVID-19 pandemic. Between January 2020 and June 2021, three installments of DA were withheld as part of the government’s cost-saving measures during the economic slowdown.
For years, employee unions and pensioners’ associations have demanded that these 18 months of arrears be released, calling it a long-overdue entitlement.
Government’s Position in November 2025
In a recent parliamentary reply, the Ministry of Finance clarified that the 18-month DA arrears will not be released, citing fiscal constraints and the need to maintain economic stability.
However, the government emphasized that regular DA hikes, which were resumed in July 2021, continue to be implemented twice a year.
As a positive move, the Cabinet has approved a 3% DA increase, raising the allowance from 55% to 58% of the basic pay and pension, effective July 1, 2025. The arrears for July, August, and September will be paid with the November 2025 salary or pension, just ahead of Diwali.
DA Arrears and Hike 2025 – At a Glance
| Category | Details |
|---|---|
| Frozen DA Period | January 2020 – June 2021 (18 months) |
| Government Decision | No payment of frozen arrears due to fiscal pressure |
| Current DA Rate | Increased from 55% to 58% |
| Effective Date | July 1, 2025 |
| Arrears Payment Timeline | With November 2025 salary/pension (for July–Sept 2025) |
| Beneficiaries | 48 lakh employees and 66 lakh pensioners |
Impact on Salary and Pension
The 3% DA hike will provide a noticeable increase in take-home pay and pension.
For example, an employee with a basic salary of ₹30,000 will receive an additional ₹900 per month, which equals ₹10,800 annually. Pensioners will receive the same rate of increase under Dearness Relief (DR), offering a small yet timely financial cushion before the festive season.
Final Thoughts
The DA Arrears Update – November 2025 brings mixed news for employees and pensioners. While the 18-month arrears remain unreleased, the 3% DA increase and payment of recent arrears bring some relief amid rising costs.
Employees are advised to manage their finances wisely, as the upcoming 8th Pay Commission (January 2026) could lead to further adjustments in salary and pension structures.
The update reaffirms the government’s approach of maintaining fiscal discipline while still supporting its workforce with periodic relief.