On 28 October 2026, the Union Cabinet approved an additional instalment of Dearness Allowance for Central Government employees and Dearness Relief for pensioners with effect from 1 July 2026. The rate increases by three percentage points—from 60% to 63% of basic pay or basic pension.
What the Cabinet approved
| Announcement date | 28 October 2026 |
|---|---|
| Effective date | 1 July 2026 |
| Old rate | 60% of basic pay or basic pension |
| Increase | 3 percentage points |
| Revised rate | 63% of basic pay or basic pension |
| Estimated beneficiaries | About 48.54 lakh Central Government employees and 68.71 lakh pensioners |
| Annual exchequer impact | ₹10,016.10 crore |
The Ministry of Finance release states that the increase follows the accepted formula based on the Seventh Central Pay Commission’s recommendations.
How much does the monthly amount increase?
| Basic pay / pension | At 60% | At 63% | Monthly increase |
|---|---|---|---|
| ₹30,000 | ₹18,000 | ₹18,900 | ₹900 |
| ₹50,000 | ₹30,000 | ₹31,500 | ₹1,500 |
| ₹80,000 | ₹48,000 | ₹50,400 | ₹2,400 |
| ₹1,00,000 | ₹60,000 | ₹63,000 | ₹3,000 |
The simple formula is: basic pay or basic pension × 3%. This gives the additional monthly amount. For arrears, multiply that monthly increase by the number of unpaid months beginning with July 2026.
Who is covered—and who is not automatically covered?
The official release expressly covers Central Government employees and pensioners. It does not announce a general increase for employees of Central Public Sector Enterprises, State Governments, local bodies or autonomous organisations.
Those groups should check the pay-revision framework and separate order applicable to their employer or government. A PSU employee should not substitute 63% into payroll merely because the Central Government rate has changed.
What employees and pensioners should do
- Check the correct basic amount. Use basic pay for an employee and basic pension for a pensioner—not gross salary, gross pension or the existing DA/DR figure.
- Calculate the monthly difference at 3%. This is the additional amount before any payroll or pension-specific adjustment.
- Track arrears from 1 July 2026. Reconcile each eligible month once the implementing order is reflected in the salary slip or pension statement.
- Do not assume a payment month. The Cabinet release confirms the effective date but does not state the payroll or pension-credit date. Follow the implementing Office Memorandum and departmental communication.
- Escalate only after checking the order. If the revised rate or arrears are missing after implementation, compare the basic amount and eligible months before raising a payroll, PAO or pension-disbursing-bank query.
What the announcement does not say
The release does not specify the exact disbursement date, month of credit or detailed payroll procedure. As reviewed on 29 October 2026, the Department of Expenditure’s circulars page had not yet listed the corresponding 63% DA Office Memorandum. The PIB announcement should therefore be read together with the implementing order when it is issued.
Reviewed on 29 October 2026. Calculations above illustrate the three-percentage-point increase and do not replace the applicable pay, pension or employer-specific order.