Cabinet okays 2% DA hike for central govt employees

The Union Cabinet approved the release of an additional instalment of Dearness Allowance (DA) to central government employees and dearness relief (DR) to pensioners with effect from January 1, 2025, representing an increase of 2% over the existing rate of 53% of the basic pay/pension, to compensate against price rise.

The combined impact on the exchequer on account of increase in both Dearness Allowance and Dearness Relief would be ₹6614.04 crore per annum. This will benefit about 48.66 lakh Central Government employees and 66.55 lakhs pensioners. This increase is in accordance with the accepted formula, which is based on the recommendations of the 7th  Central Pay Commission, the ministry of finance said.

In a separate development, the ministry said the government has received ₹25,46,317 crore (80.9% of corresponding revised estimate 2024-25 of total receipts up to February, 2025 comprising ₹20,15,634 crore tax revenue (Net to Centre), ₹4,93,319 crore of Non-Tax Revenue and ₹37,364 crore of Non-Debt Capital Receipts. ₹11,80,532 crore has been transferred to State Governments as Devolution of Share of Taxes by Government of India upto this period which is ₹1,47,099 crore higher than the previous year.

Total Expenditure incurred by Government of India is ₹38,93,169 crore (82.5% of corresponding RE 2024-25), out of which ₹30,81,282 crore is on Revenue Account and ₹8,11,887 crore is on Capital Account. Out of the Total Revenue Expenditure, ₹9,52,844 crore is on account of Interest Payments and ₹3,63,005 crore is on account of Major Subsidies, the ministry said.