Cabinet approves Dearness Allowance to Central Government employees and Dearness Relief to Pensioners

The Union Cabinet, chaired by the Prime Minister, has approved the release of an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners with effect from July 1, 2026. This represents a 3% increase over the existing rate of 60% of the Basic Pay or Pension, aimed at compensating against price rises. The decision will benefit about 48.54 lakh Central Government employees and 68.71 lakh pensioners, with a combined financial impact on the exchequer amounting to Rs. 10,016.10 crore per annum. The increase follows the accepted formula based on the recommendations of the 7th Central Pay Commission.