The Union Cabinet on Wednesday approved a 3 per cent hike in Dearness Allowance (DA) and Dearness Relief (DR) for central government employees and pensioners, ending the wait for over one crore central government employees and pensioners ahead of Diwali.
With the development, the DA rate climbed to 63 per cent from 60 per cent.
The revision in DA rates is based on the formula established under the recommendations of the 7th Pay Commission. The development would cost Rs 10,016 crore more to the Union government.
What Are Benefits For Employees Under 6th and 5th Pay Commission?
- Employees under the 6th CPC will see a hike in DA/DR from 262 per cent to 269 per cent of basic pay (+7 per cent)
- Salary for employees under the 5th CPC will see a rise in DA/DR from 483 per cent to 497 per cent of basic pay (+14 per cent) from July 2026.
Union government usually revises DA twice a year, and the revised rates come inti effect from January and July.
These revisions are always recommended by the pay commission, considering the movements in the Consumer Price Index for Industrial Workers (CPI-IW).
How It Will Impact Employees' Salary: The latest revision will raise the amount hitting central government employees by 3 per cent as the DA rates revised to 63 per cent from 60 per cent of basic pay.
Other Decisions in Cabinet
- The cabinet, headed by Prime Minister Narendra Modi, approved a Manufacturing Promotion Scheme with an allocation of Rs 10,000 crore.
- Khelo India Sports Goods Manufacturing Scheme also got an allocation of Rs 1,856 crore
- The cabinet gave nod for a Rs 7,395 crore fund for Pradhan Mantri Viksit Gram Swaraj Yojana