Cabinet Approves 4% Increase in Dearness Allowance and Relief from 01.07.2023

4% Increase in Dearness Allowance and Relief Approved by Cabinet

In a significant decision, the Union Cabinet, under the leadership of Prime Minister Narendra Modi, has given the green light for a 4% increase in Dearness Allowance (DA) for Central Government employees and Dearness Relief (DR) for pensioners, effective from July 1, 2023. This increment raises the rate from 42% of the Basic Pay/Pension to 46% and is intended to counteract the impact of rising prices. The decision aligns with a well-established formula, derived from the recommendations of the 7th Central Pay Commission.

This decision will result in an annual financial impact of Rs. 12,857 crore on the government’s finances. It is expected to directly benefit a substantial number of individuals, with approximately 48.67 lakh Central Government employees and 67.95 lakh pensioners set to enjoy the increased Dearness Allowance and Relief. This move underscores the government’s commitment to addressing the economic challenges posed by inflation and ensuring the well-being of its employees and pensioners.

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