Centre Approves 3% DA Hike for Government Employees

The Union Cabinet on October 28, 2026, approved a 3-percentage-point increase in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners. The decision raises the rate from 60% to 63% of basic pay or pension, providing additional financial support amid rising living costs. The announcement comes ahead of the festive season, offering a potential boost to millions of government employees and retired beneficiaries.

The revised DA and DR rates will be effective from July 1, 2026. Eligible beneficiaries may therefore receive arrears for the period covered by the revision, depending on the applicable government orders and payment schedule. The previous revision had increased the allowance from 58% to 60%. The latest decision continues the government's practice of periodically reviewing these payments to account for changes in the cost of living.

According to media reports, the increase is expected to benefit approximately 48.54 lakh central government employees and 68.71 lakh pensioners. The estimated annual financial impact on the government exchequer is around ₹10,016 crore. Dearness Allowance is calculated as a percentage of basic pay, while pensioners receive the corresponding benefit through Dearness Relief. The actual additional amount varies according to an individual's basic pay or eligible pension.

Under the revised rate, an employee with a basic pay of ₹18,000 would receive an additional ₹540 per month, while an employee earning a basic pay of ₹30,000 would receive an additional ₹900 per month in DA. These figures represent only the increase arising from the three-percentage-point revision. The amount of arrears and the date of payment will depend on the applicable rules and official implementation instructions.

The latest approval applies to eligible central government employees and pensioners. It does not automatically change the DA rate for employees of state governments, including Rajasthan, because each state issues its own decisions and orders. Beneficiaries should check official government notifications and departmental instructions for confirmation of the revised rates, arrears and payment dates. The increase brings the central government's DA and DR rates to 63%, effective July 1, 2026.