Four states, Rajasthan, Tamil Nadu, Chhattisgarh and Madhya Pradesh, have announced hikes in dearness allowance (DA) for state government employees and dearness relief (DR) for pensioners ahead of Diwali.
The announcements come after the Centre approved a 3 percentage point increase in DA for central government employees and DR for pensioners, taking the rates from 60% to 63%, effective July 1, 2026.
The state governments have announced different rates of increase, effective dates and payment arrangements.
Here is a look at the decisions announced by the four states:
Rajasthan: DA and DR raised to 63%
The Rajasthan government has approved a 3 percentage point hike in DA and DR, taking the rates from 60% to 63% for state government employees and pensioners covered under the Seventh Pay Commission.
According to an official statement, Chief Minister Bhajanlal Sharma approved the revision on October 30. It will be effective retrospectively from July 1, 2026, and benefit more than seven lakh employees and over five lakh pensioners.
Employees will receive the revised DA with their November salary, payable in December. However, arrears for July to October will be deposited in their General Provident Fund (GPF) accounts.
Pensioners will receive the enhanced DR in cash with effect from July 1.
The decision will result in an additional expenditure of ₹820 crore for the state government. Rajasthan has also announced an ad hoc bonus for around six lakh eligible employees, involving an additional expenditure of ₹406 crore.
Tamil Nadu: 3 percentage point hike, rates raised to 63%
Tamil Nadu Chief Minister C Joseph Vijay announced a 3 percentage point increase in DA for state government employees, teachers and pensioners on October 31.
The revision will raise DA from 60% to 63%, effective July 1, 2026, and benefit around 16 lakh employees, teachers, pensioners and family pensioners.
According to a government release, the decision follows a review of the Centre’s DA hike for central government employees.
The revision will entail an additional annual expenditure of ₹1,858 crore for the state exchequer.
Chhattisgarh: DA increased by 2 percentage points
Chhattisgarh Chief Minister Vishnu Deo Sai announced a 2 percentage point increase in DA for state government employees on October 29, taking the rate to 60%.
The revised rates will come into effect from November 1, 2026, and benefit around 3.85 lakh state government employees and 1.5 lakh pensioners, according to a statement.
The hike will increase the state’s expenditure by around Rs 36 crore per month, or Rs 432 crore annually.
Madhya Pradesh: 2 percentage point hike announced
Madhya Pradesh Chief Minister Mohan Yadav announced a 2 percentage point increase in DA for state government employees, including officers, on October 30.
The revised DA will be payable to employees from January 2026. The increased amount will be paid in cash with the October salary, payable in November.
Arrears for the nine-month period from January to September will be paid in three equal monthly instalments.
For pensioners, the corresponding increase in dearness relief will be effective from July 2026, the Chief Minister said.
What is dearness allowance and why is it revised?
Dearness allowance is paid to government employees to help offset the impact of inflation on their purchasing power. Dearness relief is the corresponding benefit provided to pensioners.
The Centre and state governments periodically revise DA and DR, generally based on changes in the Consumer Price Index for Industrial Workers (CPI-IW).
While the Centre announces revisions for its employees and pensioners, state governments take separate decisions on DA and DR for their respective employees and retirees. Consequently, the rates, effective dates and payment schedules can differ across states.
-With PTI inputs