‘Rs 37,530 cr saved from DA freeze will help govt tide over economic impact of COVID-19’

  • The amount Rs 37,530.08 crore saved on this account will help it (government) to tide over the economic impact of COVID-19 pandemic, said Thakur

  • The minister also assured that the three pending instalment of DA of Central government employees and pensioners will be restored prospectively as and when a decision is taken

New Delhi: The government has said that the Dearness Allowance (DA) freeze imposed by it for government employees will allow it to save Rs 37,530.08 crore and will help it in tiding over the economic impact of the COVID-19 pandemic. While responding to a question in the Rajya Sabha on Tuesday, Minister of State (MoS) for Finance Anurag Thakur said, “In view of the crisis arising out of COVID-19 pandemic, the Government has decided to freeze three instalments of Dearness Allowance and Dearness Relief to Central Government employees and pensioners due from 01.01.2020, 01.07.2020 and 01.01.2021.”

“The amount Rs 37,530.08 crore saved on this account will help it (government) to tide over the economic impact of COVID-19 pandemic,” Thakur added.

Govt intends to resume DA payments, but no clarity on timeline

The minister also assured that the three pending instalment of DA of Central government employees and pensioners will be restored prospectively as and when a decision is taken in this regard. Thakur also added that the pending instalments of DA for Central government employees will be subsumed in the cumulative revised rates effective from July 1. “As and when the decision to release the future instalments of Dearness Allowance due from 01.07.2021 is taken, the rates of DA as effective from 01.01.2020, 01.07.2020 and 01.01.2021 will be restored prospectively and will be subsumed in the cumulative revised rates effective from 01.07.2021,” said Thakur.

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The backdrop

Currently, Central employees get DA of 17 percent. In 2020, the Union Cabinet had approved a 4 percent increase in DA for government employees and 21 percent for pensioners. This was to be effective from January 1 this year. However, the Finance Ministry in April 2020 put increment in DA on hold or 50 lakh Central government employees and 61 lakh pensioners till July 2021 in view of the COVID-19 crisis.

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