New Delhi: The Union Cabinet has approved a 2% increase in Dearness Allowance (DA) for government employees. This raises the allowance from 58 per cent to 60 per cent.
Dearness relief (DR) for pensioners has also been increased from 58% to 60%.
The revised rate will be effective from January.
“The Union Cabinet chaired by Prime Minister Narendra Mo
di has approved to release an additional instalment of Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners w.e.f. January 1, 2026, representing an increase of 2% over the existing rate of 58% of the basic pay/pension, to compensate against price rise,” the Ministry of Finance said in a statement on Saturday.
It will benefit 50.46 lakh Central government employees and 68.27 lakh pensioners, with the combined impact on the exchequer being Rs 6791.24 crore per annum, the Ministry added.
Dearness Allowance, linked to inflation and calculated using the Consumer Price Index for Industrial Workers (CPI-IW), is revised twice a year, usually in January and July. However, there was a delay in the announcement this time.