Uttar Pradesh raises dearness allowance from 55% to 58% effective July 1, 2025, benefiting about 28 lakh state employees and pensioners. Read how the 3% DA increase will change take-home pay, pensions and household budgets ahead of Diwali.
Uttar Pradesh has raised the dearness allowance (DA) and dearness relief for state employees and pensioners by 3 percentage points — from 55% to 58% — effective July 1, 2025. The state government says the move will benefit roughly 28 lakh employees, pensioners and family pensioners and comes timed ahead of Deepavali to provide financial relief and boost consumer spending during the festival season. This one-time DA revision directly increases salary components tied to DA, raising basic-pay-linked cash in hand for workers and lifting monthly pensions for retirees.
For an average state employee, the 3% rise in DA will translate into a clear rupee increase in gross and net pay depending on their pay band and allowances. Pensioners will see a proportional rise in dearness relief, which helps with recurring expenses such as food, fuel and medical care. The hike is likely to nudge disposable income for low- and middle-income households, support festive demand in local markets, and marginally improve consumption-driven sectors in the state economy.
Operationally, payroll units in government departments will adjust salary statements to reflect the 58% DA rate from the stated effective date. Departments will also update pension disbursement files so retirees receive arrears where applicable. Economists say such targeted DA increases help cushion inflationary pressures for public-sector beneficiaries, though the fiscal impact on the state budget depends on the total wage bill and arrears payout. Workers’ unions and employee associations typically welcome these revisions; employers and budget planners will watch for any broader fiscal adjustments in upcoming state financial statements.
