New Delhi, Nov. 3 -- The Union Cabinet has hiked dearness allowance by 3% for central government employees and pensioners, raising the component from 60% to 63% of basic pay, effective from 1 July, as per the 7th Central Pay Commission recommendation.

Under 7th CPC recommendations, DA is hiked twice a year, using data from the All-India Consumer Price Index (AICPI). This "Diwali gift" is the second DA increase this year, after the Centre hiked the component by 2% in April from 58% to 60%, effective from 1 January.

DA is a percentage of employees' basic pay that aims to mitigate the impact of the rising cost of living and inflation. Usually, announcements from the Centre come in March and October, with rollouts in January and July. Over ...