Cabinet Approves 2% Increase in Dearness Allowance for Central Government Employees

The Union Cabinet, led by Prime Minister Narendra Modi, has sanctioned an additional 2% increase in Dearness Allowance for Central Government employees and Dearness Relief for pensioners, effective from January 1, 2026. This adjustment elevates the existing rate to 60% of Basic Pay/Pension to counter inflation impacts. The estimated fiscal impact is Rs.6791.24 crore annually, benefitting approximately 50.46 lakh employees and 68.27 lakh pensioners, aligning with the 7th Central Pay Commission's guidelines.

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