Historic Rise: Dearness Allowance Boosts Benefits for Millions

The Union Cabinet approved a 2% increase in Dearness Allowance and Dearness Relief for central government employees and pensioners, effective January 1, 2025. This decision, affecting 1.15 crore individuals, aims to offset inflation and raises the financial burden on the exchequer by Rs 6,614.04 crore annually.

In a significant move, the Union Cabinet raised the Dearness Allowance (DA) by 2 percentage points for central government employees and pensioners, starting from January 1, 2025.

This decision will benefit around 1.15 crore individuals, with Information and Broadcasting Minister Ashwini Vaishnaw declaring it a measure to counter rising prices. The increase elevates the DA to 55% of basic pay.

The financial impact of this raise will see an additional Rs 6,614.04 crore spent annually from the national treasury, aligning with the 7th Central Pay Commission's formula.