The Union Cabinet approves a 3% DA and DR hike from July 1, 2026, raising rates to 63% and benefiting 48.54 lakh employees and 68.71 lakh pensioners.
Centre Approves 3% DA Hike for Government Employees and Pensioners
New DA and DR rates to rise to 63% from July 1, 2026
Decision to benefit over 1.17 crore employees and pensioners
New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved an additional 3% instalment of Dearness Allowance (DA) for Central Government employees and Dearness Relief (DR) for pensioners, effective from July 1, 2026.
With the latest revision, DA and DR will increase from 60% to 63% of Basic Pay and Pension, respectively. The increase is intended to offset the impact of rising prices on the earnings and pension benefits of government employees and retirees.
According to the government, the decision will benefit approximately 48.54 lakh Central Government employees and 68.71 lakh pensioners. The combined annual financial implication for the exchequer is estimated at ₹10,016.10 crore.
The increase has been approved in accordance with the accepted formula based on the recommendations of the 7th Central Pay Commission.
Dearness Allowance is paid to serving government employees, while Dearness Relief is provided to pensioners. Both are periodically revised to help cushion the impact of inflation on their income.
The revised rates will be applicable retrospectively from July 1, 2026.
