Business
Cabinet raises central government DA by 3%
Hindustan Times·
The Union Cabinet on Wednesday raised dearness allowance for about 4.85 million central employees by 3 percentage points to 63 percent. Dearness relief for 6.87 million pensioners rose by the same margin. Ashwini Vaishnaw said it takes effect from July 1, 2026. Combined annual cost is Rs 10,016 crore. April's hike had lifted DA from 58 percent to 60 percent.
Prism
What It Means For You
- Central employees see DA move to 63 percent of basic pay from the July 1, 2026 effective date.
- Central pensioners receive a matching dearness relief increase covering 6.87 million people in the announcement.
- The exchequer impact stated for DA and DR together is Rs 10,016 crore per year.
What's Happening
- The Cabinet chaired by Prime Minister Narendra Modi approved the three-percentage-point rise on Wednesday.
- Vaishnaw described the decision as a Diwali gift for employees and pensioners.
- Officials said the formula follows 7th Central Pay Commission practice tied to the CPI-IW.
How DA And DR Move
- DA and DR are generally revised twice a year, often from January and July.
- The prior raise announced on April 18 lifted both from 58 percent to 60 percent at a cost of Rs 6,791.24 crore a year.
- DA is paid to protect basic pay from inflation erosion, according to the Commission framing cited.
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