Central Govt Employees’ DA, DR Freeze Saved Rs 34,000 crore

Amid the COVID19 pandemic, the Government of India froze three instalments of dearness allowance (DA) and dearness relief (DR) of Central government employees. This step enabled the government to save around Rs 34,402.32 crore. This information was provided by the Minister of State for Finance, Pankaj Chaudhary, in a written reply in Lok Sabha. According to Pankaj Chaudhary, government decided to stop DA and DR to ease pressure on finances on account of economic disruptions caused by Covid-19.

The Minister informed that the existing rate of DA has been increased from 17 per cent to 28 per cent. This enhanced rate of DA will be payable to Central government employees from July 1, 2021. Citing that the rate of DA from January 1, 2020 till June 30, 2021 will remain at 17 per cent, the minister informed the rate hike from 17 per cent to 28 per cent subsumes additional instalment arising on January 1, 2020, July 1, 2020 and January 1, 2021. In a circular released by the Department of Expenditure under the Finance Ministry had also clarified that the additional instalments on account of the frozen instalments will be subsumed by the latest increase.