DA Hike: Cabinet Raises Dearness Allowance to 63% From 1 July

The Union Cabinet on Wednesday, 28 October, raised dearness allowance (DA) for central government employees and dearness relief (DR) for pensioners by 3 percentage points, from 60 per cent to 63 per cent of basic pay or pension, according to a Press Information Bureau (PIB) release. The new rate applies from 1 July 2026, and the release says the increase is meant to compensate for price rise. Information and Broadcasting Minister Ashwini Vaishnaw announced the decision in New Delhi.

1.17 Crore People Get the Higher Rate

The release says about 48.54 lakh central government employees and 68.71 lakh pensioners will benefit. For an employee with a basic pay of ₹50,000 a month, three more percentage points of DA add ₹1,500 a month before any other adjustment.

Because the rate is effective from 1 July, the months since then would normally be paid as arrears. The release does not give an arrears figure, and it does not say which month’s salary or pension will carry the higher rate.

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₹10,016 Crore a Year for the Exchequer

PIB puts the combined annual cost of DA and DR at ₹10,016.10 crore. The release calls the decision an additional instalment and says it follows the accepted formula based on the 7th Central Pay Commission’s recommendations. Under that arrangement DA is revised twice a year, with effect from 1 January and 1 July. The previous instalment, approved with effect from 1 January 2026, took DA to the 60 per cent level that has now moved to 63.

The DA revision is separate from the 8th Pay Commission, whose pay-hike claims are covered in our fact-check on what is known and what is not. State governments make their own DA decisions, as in Himachal Pradesh’s 5 per cent instalment.

Orders on Payment Dates Still to Come

The Cabinet decision sets the rate; the payment details come in separate orders. In earlier rounds, the Department of Pension and Pensioners’ Welfare notified the pensioner rates after Cabinet approval. No date for those orders has been announced.

Source: PIB release, Cabinet approves Dearness Allowance and Dearness Relief, 28 October 2026. Also based on reporting by Business Today and Free Press Journal.

Image: PTI file photo.