The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, has given its approval to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners w.e.f. 01.01.2022 representing an increase of 3% over the existing rate of 31% of the Basic Pay/Pension, to compensate for price rise.

This increase is in accordance with the accepted formula, which is based on the recommendations of the 7^th Central Pay Commission.

The combined impact on the exchequer on account of both Dearness Allowance and Dearness Relief would be ₹ 9,544.50 crore per annum. This will benefit about 47.68 lakh Central Government employees and 68.62 lakh pensioners.

Dearness Allowance increase approved; additional instalment effective for central employees and pensioners under seventh CPC formula. An additional instalment of Dearness Allowance and Dearness Relief has been approved effective 01.01.2022, representing a three percentage point increase over the existing rate, implemented in accordance with the accepted formula based on the Seventh Central Pay Commission, resulting in an annual fiscal impact and covering serving Central Government employees and pensioners.