Dearness Allowance Hike 2026: Expert Explains Calculation, Approval Process

Governments give workers extra money called Dearness Allowance.

This extra money helps them when the cost of living goes up, like when food or bus tickets become more expensive.

The central government checks this twice a year.

The new amount can start on 1 January and 1 July.

To decide how much extra money people should get, officials look at price data from factories.

They use something called the Consumer Price Index for Industrial Workers.

The leaders of the government, called the Union Cabinet, must approve the new amount.

After approval, an official announcement is made.

Sometimes the announcement comes after the start date.

If that happens, the government may pay people the money they missed, which is called arrears.

So hearing about a hike does not mean the money arrives right away.