Cabinet Approves 3% DA Hike for Central Govt Employees & Pensioners from 01.07.2026
CABINET APPROVES 3% DA HIKE FROM 01.07.2026
Dearness Allowance for Central Govt Employees & Dearness Relief for Pensioners
Approved ByUnion Cabinet (Chair: PM Narendra Modi)
Announced On28 October 2026
Effective From01 July 2026
DA Increase3% (60% to 63%)
Major Announcement: The Union Cabinet has approved an additional instalment of Dearness Allowance (DA) for Central Government employees and Dearness Relief (DR) for pensioners, effective from 01 July 2026. The DA/DR rate has been increased from 60% to 63% of Basic Pay/Pension.
DA Increase
3%
From 60% to 63%
Beneficiaries
48.54 Lakh
Central Govt Employees
Pensioners
68.71 Lakh
Benefited by DR Hike
Exchequer Impact
₹10,016.10 Cr
Per Annum
Key Highlights
- DA/DR Rate: Increased by 3% over the existing rate of 60%, taking the total to 63% of Basic Pay/Pension.
- Effective Date: The increase is applicable from 01 July 2026.
- Employees Benefited: Approximately 48.54 lakh Central Government employees.
- Pensioners Benefited: Approximately 68.71 lakh pensioners.
- Financial Impact: The combined impact on the exchequer on account of both DA and DR would be ₹10,016.10 crore per annum.
- Formula Basis: The increase is in accordance with the accepted formula, based on the recommendations of the 7th Central Pay Commission.
- Purpose: The hike is to compensate government employees and pensioners against price rise.
What This Means for Employees & Pensioners
- Higher Take-Home Salary: Central Government employees will see an increase in their monthly salary due to the 3% DA hike.
- Higher Pension: Pensioners will receive an increased Dearness Relief amount in their monthly pension.
- Arrears: Since the hike is effective from 01.07.2026, employees and pensioners are likely to receive arrears for the period from July to the date of actual disbursement.
- 7th CPC Formula: The increase follows the established DA calculation formula based on the All India Consumer Price Index (AICPI).
- Check with Department: Employees and pensioners should check with their respective departments for specific details on disbursement and arrears.
Frequently Asked Questions
What is the new DA rate approved by the Cabinet?
The Cabinet has approved a 3% increase in DA/DR, taking the rate from 60% to 63% of Basic Pay/Pension.
From which date is the DA hike effective?
The increase is effective from 01 July 2026.
How many employees and pensioners will benefit?
Approximately 48.54 lakh Central Government employees and 68.71 lakh pensioners will benefit from this hike.
What is the financial impact on the exchequer?
The combined impact on the exchequer on account of both DA and DR would be ₹10,016.10 crore per annum.
Will employees receive arrears?
Since the hike is effective from 01.07.2026, employees and pensioners are likely to receive arrears for the period from July to the date of actual disbursement.
On what basis is the DA calculated?
The increase is in accordance with the accepted formula based on the recommendations of the 7th Central Pay Commission.
Where can I download the official press release?
You can download the PDF using the "Download PIB Release PDF" button above, or visit the official PIB website at pib.gov.in.
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