Investment News · 29 October 2026 · 3 min read
In short: The Union Cabinet on 28 October 2026 raised dearness allowance (DA) for central government employees and dearness relief (DR) for pensioners by 3 percentage points, from 60% to 63% of basic pay or pension. It applies from 1 July 2026, so arrears are due. About 48.54 lakh employees and 68.71 lakh pensioners benefit. The yearly cost is ₹10,016 crore.
How much more you get
| Basic pay or pension (monthly) | DA at 60% | DA at 63% | Extra per month | Arrears July-October |
|---|---|---|---|---|
| ₹18,000 | ₹10,800 | ₹11,340 | ₹540 | ₹2,160 |
| ₹30,000 | ₹18,000 | ₹18,900 | ₹900 | ₹3,600 |
| ₹50,000 | ₹30,000 | ₹31,500 | ₹1,500 | ₹6,000 |
| ₹1,00,000 | ₹60,000 | ₹63,000 | ₹3,000 | ₹12,000 |
Arrears are shown for July to October (four months) as an illustration; the exact payout month depends on the government’s orders. DA is an allowance to offset rising prices. It is usually revised twice a year, from January and July, using a formula based on the Seventh Central Pay Commission. The last increase, of 2 points to 60%, was approved in April 2026.
What it means for you
- Fully taxable: DA and DR are taxed as salary or pension income at your slab rate. Check your new take-home with our CTC to in-hand salary calculator.
- Use arrears wisely: A lump sum is a good chance to build an emergency fund or prepay a costly loan.
- Older pay scales: Those still on Sixth Pay Commission scales go from 262% to 269%, and Fifth Pay Commission scales from 483% to 497%.
- Pensioners: Remember to submit your life certificate by 30 November so pension and DR continue. See our life certificate guide.
What to watch next
Many state governments usually follow the Centre with their own DA increases in the following weeks. The next central revision is due from January 2027.
Sources
- Business Standard: Govt hikes DA, DR to 63% from 60% (28 Oct 2026)
- Angel One: Central Government approves 3% DA, DR hike (28 Oct 2026)
- Business Standard: Stock market live, 29 October 2026
This is a news summary for education, not investment advice. Figures are as reported on or before 29 October 2026; check official sources before making decisions.